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Notes to the financial statements
31 December 2014
Bursa Malaysia
•
Annual Report 2014
142
26. Other reserves (cont’d.)
(a) Capital reserve
On 6 December 2013, the Board of Directors of Bursa Malaysia Derivatives approved the proposed revamp of Bursa Malaysia Derivatives’ participantship
structure which creates a single trading right that would enable Bursa Malaysia Derivatives’ Trading Participants to trade all categories of products on the
derivatives exchange (“the Proposed Revamp”).
On 24 January 2014, the ordinary shareholders and holders of the non-cumulative “A”, “B” and “C” preference shares of Bursa Malaysia Derivatives
approved the proposed share capital reduction and capital repayment.
On 3 April 2014, the High Court of Malaya confirmed the proposed share capital reduction and capital repayment pursuant to Section 64 of the Companies
Act, 1965.
The Proposed Revamp was completed in the following manner upon obtaining the above requisite approvals and confirmation:
(1) On 14 April 2014, the Rules of Bursa Malaysia Derivatives were amended and all the existing non-cumulative preference shares of RM1.00 each were
cancelled as follows:
(i) 40 non-cumulative “A” preference shares;
(ii) 17 non-cumulative “B” preference shares; and
(iii) 28 non-cumulative “C” preference shares.
(2) On 15 April 2014, 19 new redeemable “A” and 14 new redeemable “B” preference shares of RM1.00 each were issued and allotted to the previous holders
of non-cumulative “A”, “B” and “C” preference shares who were entitled to the new redeemable “A” and “B” preference shares of RM1.00 each. The
entitlement to the new redeemable “A” or “B” preference shares were as follows:
(i)
Active holders of non-cumulative “A”, “B” and “C” preference shares were allotted 1 new redeemable “A” preference share; and
(ii) Dormant holders of non-cumulative “A”, “B” and “C” preference shares who surrender their participantship were allotted 1 new redeemable “B”
preference share.
(3) On 16 April 2014, all the new redeemable “A” and “B” preference shares were redeemed based on the terms and conditions of the new redeemable
preference shares as set out in the Articles of Association of Bursa Malaysia Derivatives. Bursa Malaysia Derivatives’ share premium account of
RM14,100,000 recognised as capital reserve in the Group’s financial statements, was fully utilised for the redemption.
In the previous financial years, the capital reserve was in relation to share premium in Bursa Malaysia Derivatives, which arose from“B” and “C” non-cumulative
preference shares of RM1.00 each in Bursa Malaysia Derivatives. The composition of share premium in Bursa Malaysia Derivatives was as follows:
Type of preference shares
No. of shares issued
Share premium
RM’000
“B” preference shares
17
8,500
“C” preference shares
28
5,600
14,100
The share premium from the above issues were not refundable to the preference shareholders and thus were treated as a non-distributable capital reserve.
The “B” and “C” preference shares had been accounted for as part of the Group’s non-controlling interest.