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Bursa Malaysia Celebrates Inaugural Listing of Business Trust

KUALA LUMPUR: Bursa Malaysia Bhd officially welcomed the listing of Business Trusts (BT), an alternative listing structure that facilitates capital raising by listed entities seeking an initial public offering (IPO) on the exchange.

Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said Business Trusts provide a novel listing structure to raise capital to facilitate economic development by making infrastructure-type projects more accessible to a broader range of investors.

This was demonstrated by the debut listing of Prolintas Infra BT on Monday. It was the first BT listed on the exchange’s main market and a Shariah-compliant BT.

Introduced under the Securities Commission Malaysia’s (SC) Business Trusts Guidelines (BT Guidelines) 2012, a BT is a hybrid investment structure that blends features of an investment trust and a company.

Bursa Malaysia chief executive officer Datuk Muhamad Umar Swift said BTs provide a novel listing structure to raise capital that can facilitate economic development by making infrastructure-type projects more accessible to a broader range of investors, fostering growth and innovation across more capital-intensive sectors.

“The listing of Prolintas Business Trust on our exchange exemplifies the successful implementation of the framework by the SC, and we look forward to more BTs following suit,” he said in a statement.

Essentially, BTs operate as a unit trust scheme established by a trust deed, wherein a trustee-manager oversees the operation and management of the scheme’s assets.

Unitholders in a BT can share in the profits or income generated by these assets through distributions declared by the trustee-manager.

BTs undertaking an IPO are destined for the main market, which requires SC’s approval before they are admitted to the exchange for listing.

A significant advantage of a BT is that dividend distributions a BT can be made to investors from its operating cash flow without being constrained by conventional accounting profits.

Therefore, it is anticipated that a BT will be more attractive for business assets that are capital-intensive but have stable cash flows, such as those in the infrastructure, telecommunications, and energy sectors, supporting key national growth policies and roadmaps.

“At Bursa Malaysia, we continue to undertake efforts to make listing on the exchange more appealing. One way to accomplish this is to diversify or expand into new asset classes, which opens up more opportunities.

“The introduction of the BT model expands the breadth of Malaysia’s capital market and demonstrates capital market regulators’ earnestness in providing facilitative frameworks and solutions.

“This development will augment the ability of the exchange to play its role in facilitating growth plans of listed issuers to benefit our economy at large.

“It is also our hope that this will, in turn, enhance the overall competitiveness of the exchange,” Muhamad Umar said.

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