What SGX RegCo expects of independent financial advisers for listed issuers

Background Under the SGX Listing Rules, an independent financial adviser (“IFA”) must be appointed by directors for exit offers, interested person transactions (“IPT”) and, in some cases, under a Notice of Compliance (“NOC”) to review certain transactions as required by the Exchange. An IFA is required to ensure directors receive an independent and professional opinion on a proposed transaction, including the impact on the issuer. Directors will evaluate this independent advice provided by the IFA and make a recommendation to shareholders. This provides shareholders with the information to make a decision as to whether to accept an offer, or to approve a transaction. The Guide issued by SGX Regco serves as a means to improve the standard, clarity and consistency of advice rendered by IFA. It also sets out expectations on the role directors play in procuring such advice and on IFAs and their opinions.

SGX Regco’s expectations of directors in appointment of IFA Directors are expected to take the following factors into consideration when appointing an IFA: • Directors are to ensure that the IFA (including the professionals involved in preparing and approving the IFA Opinion) must be independent and be able to give competent independent advice. • Directors are to assess the suitability of the professionals involved in preparing and approving the IFA opinion through extent of relevant experience and to consider any other information that may cast doubts on their competency, quality of advice and resourcing.