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Going Public 101

By Riva Khristine Maala |

Companies wanting to raise additional capital for expansion may list in the Philippine Stock Exchange, which provides the facility for the selling of shares to the investing public. A company may choose to list its shares in the First Board, the Second Board, or the Small and Medium Enterprises (SME) Board, provided it meets the requirements.


The First Board is for the big players. It requires the company to have a five-year operating history and a market capitalization – net tangible assets – of P500 million. The company must be operating profitably for three full fiscal years, which means having a cumulative consolidated pre-tax profit of at least P50 million and a minimum pre-tax profit of P10 million for each fiscal year.


The company must also be engaged in the same business and have a good management track record throughout the three years before filing the listing application. The company must have a minimum capitalization of P400 million, and at least 25 percent of which were subscribed and paid in full. The company must also maintain, upon and after listing with the exchange, at least 1,000 security holders each owning securities equivalent to at least one board lot.



The Second Board is for companies that demonstrate a potential for superior growth to list in the exchange. Compared with the First Board, it has far less exacting financial requirements: Authorized capital stock of P100 million, at least 25 percent of which must be subscribed and paid in full (although at listing, the market capitalization of the company must be at least P250 million). Holding companies or companies whose earnings are derived exclusively from passive revenues are now qualified to list under the Second Board.


A listing applicant in the Second Board must have an operating history of at least one year prior to its application. And unlike applicants to the First Board, the company shall only maintain a minimum of 500 security holders each owning at least one board lot of the company’s securities. A company in the Second Board may write the exchange and request to be elevated to the First Board after showing that it has met the requirements.



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