{"id":10152,"date":"2025-03-24T02:40:39","date_gmt":"2025-03-24T01:40:39","guid":{"rendered":"https:\/\/wsj-crypto.com\/?p=10152"},"modified":"2025-03-24T02:40:39","modified_gmt":"2025-03-24T01:40:39","slug":"the-impact-of-reduced-ipo-float-on-market-dynamics","status":"publish","type":"post","link":"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/24\/the-impact-of-reduced-ipo-float-on-market-dynamics\/","title":{"rendered":"The Impact of Reduced IPO Float on Market Dynamics"},"content":{"rendered":"\n<p class=\"p3\">By <b>Revin Mikhael D. Ochave, <\/b><span class=\"s2\"><i>Reporter <\/i><\/span><\/p>\n<p class=\"p4\"><span class=\"s3\">THE RECENTLY ANNOUNCED action of the Philippine Stock Ex<\/span><span class=\"s4\">change (PSE) to lessen the minimum <\/span><span class=\"s3\">public ownership (MPO) for substantial initial public offerings (IPOs) could <\/span><span class=\"s5\">have adverse effects on <\/span><span class=\"s3\">investor trust <\/span><span class=\"s6\">as it presents an \u201cunequal playing field,\u201d according to stock market analysts. <\/span><\/p>\n<p class=\"p5\"><span class=\"s3\">\u201cIt\u2019s not favorable optics for the PSE, considering they have been quite proactive in penalizing firms that do not meet public float standards, and this might be seen as the regulator bending the rules a bit to cater to major corporate interests,\u201d AP Securities, Inc. Research Head Alfred Benjamin R. Garcia expressed in a Viber message. <\/span><\/p>\n<p class=\"p5\">Unicapital Securities, Inc. Research Head Wendy B. Estacio-Cruz mentioned in a Viber message that the decrease in MPO fosters an uneven playing field.<\/p>\n<p class=\"p5\">\u201cIf exemptions become commonplace, it may cultivate an uneven playing field where larger enterprises receive more leniency than smaller ones, potentially hindering fair competition,\u201d she remarked.<\/p>\n<p class=\"p5\"><span class=\"s6\">PSE President and Chief Executive Of<\/span><span class=\"s7\">f<\/span><span class=\"s6\">icer Ramon S. Monzon stated last week that the market operator has obtained the endorsement from the Securities and Exchange Commission (SEC) to reduce the public float stipulation to encourage undecided companies to move forward with their listing intentions.<\/span><\/p>\n<p class=\"p5\"><span class=\"s6\">Companies planning IPOs can initially comply with a 15% public float, provided they commit to increasing the public float to 20% within a two-year timeframe.<\/span><\/p>\n<p class=\"p5\"><span class=\"s8\">Mr. Monzon has indicated that this measure is not permanent and will be reassessed in the forthcoming years. <\/span><\/p>\n<p class=\"p5\"><span class=\"s5\">\u201cWe have a two-year interval, and if that doesn\u2019t yield results, we will extend it <\/span>for an additional two years,\u201d he added.<\/p>\n<p class=\"p5\">The PSE\u2019s initiative coincides with GCash, managed by Globe Fintech Innovations (Mynt), preparing to go public later this year.<\/p>\n<p class=\"p5\"><span class=\"s7\">Bloomberg reported Globe Telecom, Inc. President and Chief Executive Officer and Mynt Chairman Ernest Cu as stating that the GCash IPO will partly hinge on regulators consenting to lower the public float to 10-15% for larger offerings.<\/span><\/p>\n<p class=\"p5\">Nevertheless, Mr. Garcia expressed that easing the public float requirement for IPOs contradicts ongoing initiatives to enhance corporate governance standards in the nation.<\/p>\n<p class=\"p5\">\u201cA reduced percentage of public ownership implies that the public constitutes a smaller minority that can be easily overruled or disregarded when inducing corporate resolutions,\u201d he noted.<\/p>\n<p class=\"p5\">\u201cThis also carries long-term consequences regarding the appeal of the Philippine market to investors. The requirement to elevate the public ownership threshold to 20% could also create an overhang for those participating in the IPO, due to the inevitable dilution of their stake over the next two years,\u201d he added.<\/p>\n<p class=\"p5\">Ms. Estacio-Cruz remarked that a prolonged diminished public float may also \u201cresult in lower stock liquidity and increased price fluctuations, rendering the market less appealing for retail investors.\u201d<\/p>\n<p class=\"p5\">Rizal Commercial Banking Corp. Chief Economist Michael L. Ricafort indicated in a Viber message that the lowered public float for IPO-targeted companies should merely be a temporary relief.<\/p>\n<p class=\"p5\">\u201cThis could represent a transient regulatory breather amid market volatility that has somewhat diminished market interest. It could be reinstated after a period, especially once market conditions become favorable, as these are all elements of market reforms,\u201d Mr. Ricafort articulated.<\/p>\n<p class=\"p5\">\u201cNonetheless, there needs to be a careful balance to incentivize more companies to list shares in a challenging market atmosphere,\u201d he added.<\/p>\n<p class=\"p5\"><span class=\"s7\">Conversely, China Bank Capital Corp. Managing Director Juan Paolo E. Colet mentioned in a Viber message that the recent action by the PSE will aid in persuading certain companies struggling to meet the 20% MPO. <\/span><\/p>\n<p class=\"p5\"><span class=\"s9\">\u201cIdeally, we would prefer listed companies to uphold a high public float to allow more investors to engage in wealth generation, encourage superior corporate governance standards, and boost market liquidity,\u201d he stated. <\/span><\/p>\n<p class=\"p5\">\u201cPublic float and liquidity hold particular importance for foreign investors and are critical standards for inclusion in global and regional equity indices. Therefore, to attract more foreign capital inflows into our stock market, it logically follows to encourage measures and cultivate conditions that enhance public ownership and trading levels,\u201d he emphasized.<\/p>\n<p class=\"p5\">The local exchange has not yet witnessed an IPO this year. However, some anticipated public listings comprise GCash, the Pangilinan-led water concessionaire Maynilad Water Services, Inc., and Cebu-based fuel retailer Top Line Business Development Corp.<\/p>\n<p class=\"p5\">The PSE anticipates six IPOs this year.<\/p>\n<p><br \/>\n<br \/><a href=\"https:\/\/www.bworldonline.com\/top-stories\/2025\/03\/24\/661169\/lower-ipo-float-creates-uneven-field\/\">Source link <\/a><\/p>\n","protected":false},"excerpt":{"rendered":"<p>By Revin Mikhael D. Ochave, Reporter THE RECENTLY ANNOUNCED action of the Philippine Stock Exchange (PSE) to lessen the minimum public ownership (MPO) for substantial initial public offerings (IPOs) could have adverse effects on investor trust as it presents an \u201cunequal playing field,\u201d according to stock market analysts. \u201cIt\u2019s not favorable optics for the PSE,<\/p>\n","protected":false},"author":3,"featured_media":10153,"comment_status":"closed","ping_status":"open","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[25],"tags":[1827],"class_list":["post-10152","post","type-post","status-publish","format-standard","has-post-thumbnail","category-economy-and-markets","tag-return-a-list-of-comma-separated-tags-from-this-title-lower-ipo-float-creates-uneven-field"],"yoast_head":"<!-- This site is optimized with the Yoast SEO plugin v26.3 - https:\/\/yoast.com\/wordpress\/plugins\/seo\/ -->\n<title>The Impact of Reduced IPO Float on Market Dynamics - WSJ-Crypto<\/title>\n<meta name=\"robots\" content=\"index, follow, max-snippet:-1, max-image-preview:large, max-video-preview:-1\" \/>\n<link rel=\"canonical\" href=\"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/24\/the-impact-of-reduced-ipo-float-on-market-dynamics\/\" \/>\n<meta property=\"og:locale\" content=\"it_IT\" \/>\n<meta property=\"og:type\" content=\"article\" \/>\n<meta property=\"og:title\" content=\"The Impact of Reduced IPO Float on Market Dynamics - WSJ-Crypto\" \/>\n<meta property=\"og:description\" content=\"By Revin Mikhael D. Ochave, Reporter THE RECENTLY ANNOUNCED action of the Philippine Stock Exchange (PSE) to lessen the minimum public ownership (MPO) for substantial initial public offerings (IPOs) could have adverse effects on investor trust as it presents an \u201cunequal playing field,\u201d according to stock market analysts. \u201cIt\u2019s not favorable optics for the PSE,\" \/>\n<meta property=\"og:url\" content=\"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/24\/the-impact-of-reduced-ipo-float-on-market-dynamics\/\" \/>\n<meta property=\"og:site_name\" content=\"WSJ-Crypto\" \/>\n<meta property=\"article:published_time\" content=\"2025-03-24T01:40:39+00:00\" \/>\n<meta property=\"og:image\" content=\"https:\/\/wsj-crypto.com\/wp-content\/uploads\/2025\/03\/PSE-bell-1-300x199.jpg\" \/>\n\t<meta property=\"og:image:width\" content=\"300\" \/>\n\t<meta property=\"og:image:height\" content=\"199\" \/>\n\t<meta property=\"og:image:type\" content=\"image\/jpeg\" \/>\n<meta name=\"author\" content=\"wsjcrypto\" \/>\n<meta name=\"twitter:card\" content=\"summary_large_image\" \/>\n<meta name=\"twitter:label1\" content=\"Scritto da\" \/>\n\t<meta name=\"twitter:data1\" content=\"wsjcrypto\" \/>\n\t<meta name=\"twitter:label2\" content=\"Tempo di lettura stimato\" \/>\n\t<meta name=\"twitter:data2\" content=\"3 minuti\" \/>\n<script type=\"application\/ld+json\" class=\"yoast-schema-graph\">{\"@context\":\"https:\/\/schema.org\",\"@graph\":[{\"@type\":\"WebPage\",\"@id\":\"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/24\/the-impact-of-reduced-ipo-float-on-market-dynamics\/\",\"url\":\"https:\/\/wsj-crypto.com\/index.php\/2025\/03\/24\/the-impact-of-reduced-ipo-float-on-market-dynamics\/\",\"name\":\"The Impact of Reduced IPO Float on Market Dynamics - 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