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Helping companies go public made easier by Singapore

last updated 23 June 2017

More efficient access to capital markets for tech companies with SGX-IMDA partnership.

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From L to R: Mr Tan Kiat How (CEO of Infocomm Media Development Authority), Dr Yaacob Ibrahim (Minister for Communications and Information), and Mr Loh Boon Chye (CEO of Singapore Exchange).

By Sheela Sarvananda

Launching an initial public offering (IPO) has just become easier for Singapore tech companies. A new partnership, aimed at firms accredited by the Accreditation@IMDA (A@IMDA) programme, will ensure easier and more efficient access to private and public capital markets.

Born out of a partnership between the Singapore Exchange (SGX) and Infocomm Media Development Authority (IMDA), the initiative will lower the barriers to capital markets for IMDA-accredited companies.

“Our collaboration with IMDA will foster a keener appreciation among Singapore tech firms of our capital markets as a source of funding and offer them the potential of expanding their business into the broader region,” said Mr Loh Boon Chye, Chief Executive Officer of SGX.

20170623 sgx imda 2Mr Tan Kiat How, Chief Executive at IMDA, believes the partnership is an important step in deepening the collaboration between the technology and financial ecosystems. “It enables promising tech companies to tap Singapore’s capital markets to scale up to the next phase of growth.”

A smoother path

Under the partnership, IMDA-accredited companies, as well as firms in its pipeline, will benefit from a more streamlined pathway to their IPO. For example, they will gain access to key parts of the financial ecosystem, such as expert IPO sponsors, law and audit firms. Companies will also have access to market professionals appointed by SGX and IMDA for a range of services, from pre-IPO funding and advice on listing processes to preparing for listings, at cheaper rates.

Launched in 2014, A@IMDA helps accredited companies boost their track record and gain market visibility by putting a Government stamp of approval on their products. For budding and current entrepreneurs, the accreditation process provides quality assurance when it comes to the core functionalities of products, financial sustainability and the ability to deliver.

Under the memorandum of intent signed on 31 May, SGX will nurture a number of A@IMDA tech companies towards achieving high growth. By embedding some of the steps necessary to become IPO-ready in A@IMDA’s existing accreditation process, companies in this pathway will ultimately be better prepared for listing.

It’s a two-way street story – the partnership aims to enhance information sharing between the financial and tech communities, to foster a better understanding of tech solutions’ use cases, business models, and how such tech solutions can galvanise industries they market to. The hope is that such collaborative works and successful exits will attract companies and talents to base themselves in Singapore.

A smart way forward

Minister for Communications and Information, Dr Yaacob Ibrahim, who witnessed the MOI signing, believes the partnership will allow ICM companies to leverage Singapore’s well-developed financial ecosystem more easily, to support their growth and expansion plans.

An example of an accredited company that may benefit from the SGX-IMDA partnership is Hope Technik. “Our goal is to become the number one industrial robot provider… Now it will be easier for us to get investors to support us,” said Mr Michael Leong, the engineering firm’s managing director.

The partnership comes at a significant time. Recently, Singapore was ranked the most “digitally competitive” place in the world, ahead of Sweden and the United States, by Swiss business school IMD. What’s more, a recent study by Google and Temasek Holdings revealed that the internet economy in South East Asia is expected to surge to more than S$270 billion by 2025.

Mr Benjamin Mah, Co-Founder and CEO at V-Key, another IMDA-accredited company, cheered the SGX-IMDA partnership, calling it timely. “If I try to form this partnership elsewhere, in our neighbouring countries or in the US, for instance, there is no touchpoint. Either the country is too big or just too protective. Right now, the new digital economy needs to be cemented by strong partnerships like this that focus on digital trust.”

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