The Egypt Financial Regulatory Authority held a two-day market dialogue with listed companies, securities brokers and legal advisers on implementing its latest amendments to the rules governing the listing and delisting of securities on the exchange. The amendments, issued under the authority’s Board Decision No. 46 of 2025, are framed around simplifying procedures, strengthening minority shareholder protection and increasing disclosure. For special purpose acquisition companies (SPACs), the changes add acquisition by merger alongside acquisitions through share swaps and credit balances, and expand the disclosures expected in the information memorandum submitted with a listing application. They also allow shares subscribed in a SPAC capital increase to trade at the subscription price (reflecting fair value above par) after a post-acquisition disclosure report, with the fair value determined by an independent financial adviser registered with the authority. Public trading conditions move to six-month post-acquisition financial statements prepared under Egyptian Accounting Standards and accompanied by a limited review from an FRA-registered auditor, requiring at least 5% net profit and shareholders’ equity not below paid-up capital, replacing a prior requirement for two years of annual financial statements and supporting wider access beyond qualified investors. A 51% lock-up for at least 12 months applies to certain shareholders in mergers between listed and unlisted companies in specific valuation circumstances, while the obligation to retain 51% is narrowed mainly to founders and certain insiders, leaving other subscribers able to sell. On voluntary delisting, the amendments set a maximum of 25 working days from the general assembly decision to complete final delisting and buy back the shares of affected shareholders, with daily purchases permitted under exchange rules. Delisting now requires approval by 75% of meeting attendees and, where a controlling shareholder exists and the authority verifies control, approval by a “majority of the minority” of shareholders not connected to the controller. The package also introduces quantitative and qualitative criteria for assessing stock split requests, shifts approval of listed companies’ remuneration and incentive schemes to the authority rather than the exchange, and removes boards’ power to approve voluntary delisting for companies where 75% of shares were acquired through a tender offer, making the decision one for the general assembly.
Egypt Financial Regulatory Authority 2025-02-27
Egypt Financial Regulatory Authority details amendments to exchange listing and delisting rules including new SPAC mechanisms and a 25-working-day delisting timetable
The Egypt Financial Regulatory Authority held a market dialogue on listing and delisting rule amendments, focusing on simplifying procedures, enhancing minority shareholder protection, and increasing disclosure. Key changes for SPACs include expanded acquisition methods, revised trading conditions, and new lock-up requirements. Voluntary delisting now requires 75% approval from meeting attendees and introduces new criteria for stock splits and remuneration scheme approvals.