The directors must also make known the IFA’s advice to shareholders. Shareholders should review the directors' recommendations and the IFA’s advice carefully before coming to a decision on the proposed transaction, taking into account their individual circumstances and considerations.
Under the SGX Listing Rules, an independent financial adviser (IFA) must be appointed for exit offers, interested person transactions (IPT) and, in some cases, under a Notice of Compliance (NOC), to direct the issuer to undertake certain actions or review transactions as required by the Exchange.
The purpose of requiring an IFA is to ensure that the directors receive an independent and professional opinion on a proposed transaction, including the impact on the issuer. In relation to IPT, the directors should take into consideration such independent advice and make a recommendation to shareholders as to whether the transaction is on normal commercial terms and not prejudicial to the interests of the issuer and its minority shareholders. For exit offers, the directors would make a recommendation on whether to accept the terms of the offer after taking into consideration the opinion of the IFA.
