Recently reported in The Star about more public disclosure of the reasons for IPO rejection:

“The Securities Commission (SC) plans to publish on its website soon the reasons why it rejects some of the initial public offering (IPO) proposals it receives. The move is intended to further enhance transparency of SC’s decision-making and serves as a guide for future applicants and their advisers.”

It’s indeed a step forward as with this proposed public disclosure move by the SC, the public can now have a better understanding for the reason(s) for rejection. This was previously not so as the reasons for rejections were kept by the IPO applicants and their advisor.

Of the 51 IPO applications received in the first half of 2006, the SC approved 18, rejected 28, four were withdrawn or returned and one deferred.

One interesting fact revealed by SC is that the main reasons for the IPO rejections were the concerns on corporate governance and failure of the applicants to demonstrate future sustainability of the business.