SC Revises SPAC Framework

New rules offer greater access to funding

16 December 2021

The Securities Commission Malaysia (SC) announced today revisions to the Equity Guidelines in the enhanced Special Purpose Acquisition Company (SPAC) framework to facilitate greater access to fundraising in Malaysia, as part of its ongoing efforts to promote the development of the Malaysian capital market.

“The SC re-evaluated the SPAC framework to ensure that it remains relevant and capable of spurring interest in listings and deals involving SPACs, thereby providing issuers with greater access to the capital market,” said SC Chairman Datuk Syed Zaid Albar.

The revisions will, among others:

  • Enable business combinations via issuance of securities as consideration for the Qualifying Acquisition (QA). Currently, SPACs may only meet the QA requirement by way of cash acquisitions.

  • Broaden the avenue for SPACs to obtain additional financing by allowing private placements for QA. In addition, the minimum amount of funds required to be raised by a SPAC through its initial public offering (IPO) has been reduced from RM150 million to RM100 million.

  • Allow professionals with extensive experience in private equity and venture capital with asset sourcing and deal making experience to steer SPACs. This could potentially broaden the target asset universe and spur mergers and acquisitions by Malaysian corporations.

  • To minimise the greenmail[1] issue faced by SPACs, the threshold for shareholders’ approval of the QA has been reduced from a special resolution of at least 75% majority to a simple majority approval by all shareholders present and voting.

  • To reflect the inherent risks of investing in SPACs, the minimum IPO price has been raised from RM0.50 to RM2.00 to ensure that it attracts investors who are able and willing to take on the unique risks associated with investing in SPACs.

  • To limit dilution to existing shareholders, new shares issued from the exercise of warrants will be restricted to not more than 50% of the total number of issued shares of the SPAC.

The framework for the listing of SPACs in Malaysia was first introduced in 2009 to promote private equity activities, spur corporate transformation and encourage mergers and acquisitions, all of which were intended to enhance the depth, breadth and competitiveness of the domestic capital market. The review of the SPAC framework is in line with the Capital Market Masterplan 3’s aspiration to create a capital market that is relevant, efficient and diversified.

While the Malaysian capital market has seen new development and innovation, the SC would like to remind investors that SPACs is an alternative capital market investment option that may carry higher investment risk when compared with shares of listed corporations with operating businesses. Investors should familiarise themselves with the nature of SPACs and consider whether the investment meets their objectives and risk profile.

The revised SPAC framework will take effect on 1 January 2022, and a copy of the revised Equity Guidelines can be found here -

1 ‘Greenmail’ tactics is a strategy used by certain investors who acquire interests in a SPAC and use the ability to vote against a proposed QA to obtain additional consideration from the management team


about the SC
The Securities Commission Malaysia (SC) was established on 1 March 1993 under the Securities Commission Act 1993 (SCA). We are a self-funded statutory body entrusted with the responsibility to regulate and develop the Malaysian capital market.

General Line: +603-6204 8000
General Email: [email protected]
© Copyright Securities Commission Malaysia.  Contact Us   |    Disclaimer   |   The site is best viewed using Microsoft Edge and Google Chrome with minimum resolution of 1280x1024
Generic Popup