KUALA LUMPUR: Eleven small and medium enterprises (SMEs) have engaged advisers to help them get listed on Bursa Malaysia???s newly launched Leading Entrepreneur Accelerator Platform (LEAP).
The platform, an alternative for SMEs to raise funds via a listing on Bursa and aimed at growing Malaysian SMEs, was launched by Prime Minister Datuk Seri Najib Razak yesterday at Invest Malaysia 2017.
It was established with the realisation that SMEs form the backbone of the nation???s economy, as the segment makes up 97% of businesses in the country, said Najib.
???It is in line with our SME Masterplan, which aims to raise the share of GDP (gross domestic product) contributed by SMEs, their number of employees and their volume of exports,??? Najib said in his keynote address at Invest Malaysia.
???LEAP is an alternative capital-raising platform for SMEs and the first of its kind in Asean. It is designed to address the funding gap for SMEs and make it easier for them to take their businesses to the next level through raising funds in the capital market,??? said Bursa Malaysia chief executive officer Datuk Seri Tajuddin Atan.
Investing in LEAP is limited to sophisticated investors or accredited investors, high-net-worth entities and high-net-worth individuals. LEAP equivalents can be found in the US, South Korea, India, China and Taiwan.
LEAP-listed companies are also subject to accounting standards similar to those listed on the Main Market. Approved advisers for LEAP now are: Kenanga Investment Bank Bhd, M&A Securities Sdn Bhd, Mercury Securities Sdn Bhd, TA Securities Holdings Bhd, Crowe Horwarth Advisory Sdn Bhd, DWA Advisory Sdn Bhd and WYNCorp Advisory Sdn Bhd.
A head of research with one of the approved advisers told The Edge Financial Daily LEAP will only be suitable for investors with a higher risk appetite. ???Funding options for SMEs are usually more to conventional funding through banks. Recently, we are seeing a growing trend in other funding options, ??like peer-to-peer financing, equity crowdfunding, venture capitalists and others. LEAP would provide another alternative for investors with a higher risk appetite. The difference is that LEAP will only feature companies approved by Bursa, which gives a certain assurance about the companies listed,??? he said on the sidelines of the event.
Another fund manager, who declined to be named, told the daily LEAP will likely be classified as an alternative investment class or a new investment class, so some funds will not be able to invest in it, given existing fund mandates. ???If it???s an alternative investment, there is other competition in the space as well, like private equity investment, which is beginning to gain momentum here. I think it will take a while before it (LEAP) could gain more interest,??? he said.
Bursa will be working with four strategic partners to support the identification of potential SMEs to be listed. Among them are: Malaysia Digital Economy Corp, Malaysian Technology Development Corp, SME Corp and Unit Peneraju Agenda Bumiputera.