One of the key objectives in Boursa Kuwait is to enhance savings by encouraging investment in securities, developing investment awareness, protecting investors, and introducing ways to invest money in securities for the interest of the economy.
Therefore, Boursa Kuwait has obliged companies and funds willing to be listed to expand their shareholders base to ensure that the minimum number of total shares/units not owned by the controlling person or the controlling group is maintained to protect minorities and investors’ rights and not to let them go under the pressure of the company/fund’s main controlling investor.
Accordingly, Boursa Kuwait mandated the appointment of an Asset Valuator, or an Investment Advisor licensed by the Capital Markets Authority to assess the fair value of all shares/units not owned by the controller or the controlling group.
What are the governing references that companies are required to submit Fair Value Reports for Non-controlling Interests?
According to Boursa Kuwait Rulebook, it is stipulated as follows:
| Article | Listing requirements |
|---|---|
| Article No. 7-1-4 concerning the requirements for the company to be listed in the Premier Market | Item No. 1 of the requirements stipulates the following: “The fair value of the shares that are not owned to the controller or the Group controlling the company shall be at least KWD 45 million, and the fair value of the share shall be determined by Asset Valuator or Investment Advisor licensed by the Authority.” |
| Article No. 7-1-5 concerning the requirements for the company to be listed in the Main Market | Item No. 1 of the requirements stipulates the following: “The fair value of the shares that are not owned to the controller or the Group controlling the company shall be at least KWD 15 million; and the fair value of the share shall be determined by Asset Valuator or Investment Advisor licensed by the Authority.” |
| Article No. 7-10 concerning the requirements for the funds to be listed in the Boursa Kuwait | Item No. 2 of the requirements stipulates the following: “The fair value of the total units that are not owned by the controlling party or the controlling group shall be equivalent to at least fifteen million Kuwaiti dinars. The fair value of the unit shall be determined by an Asset Valuator or an Investment Advisor authorized by the Authority.” |
What is the added value to business entities from preparing a Fair Value Report for Non-controlling Interests?
- Compliance with regulatory requirements of the Capital Markets Authority
- Protecting minorities’ rights attributable to investors in companies and unit holders in investments funds.
Why Baker Tilly Kuwait?
Baker Tilly Kuwait is distinguished by specialist professional experience and offers the following characteristics carrying added value to our clients as follows:
- Baker Tilly has a license as an Investment Advisor from the Capital Markets Authority;
- A global consulting firm with local presence in the State of Kuwait;
- Professional team with in-depth experience in providing investment consultancy services in Kuwait.
What are the services provided by Baker Tilly Kuwait?
Preparation of Non-controlling Interests Valuation Report