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Index Change Advice - 20120918_Free_Float_Definitions
Update to Free Float Definitions
FTSE/JSE Africa Index Series
18 September 2012
In order to provide further transparency in the determination of the free float figures
used in the calculation of FTSE indices, please note the following clarifications to Section
4 of the FTSE UK and Section 6 of the FTSE Global Equity Index Series Ground Rules
with immediate effect.
Existing Rule
Free float restrictions include:
• Shares directly owned by State, Regional, Municipal and Local governments (excluding
shares held by independently managed pension schemes for governments).
• Shares held by Sovereign Wealth Funds where each holding is 10% or greater. If the
holding subsequently decreases below 10%, the shares will remain restricted until the
holding falls below 7%.
• Shares held by directors, senior executives and managers of the company, and by their
family and direct relations, and by companies that they control.
• Shares held within employee share plans.
• Shares held by public companies or by non-listed subsidiaries of public companies.
• Shares held by founders, promoters, former directors, founding venture capital and
private equity firms, private companies and individuals (including employees) where the
holding is 10% or greater. If the holding subsequently decreases below 10%, the shares
will remain restricted until the holding falls below 7%.
• All shares where the holder is subject to a lock-in clause (for the duration of that
clause).
• Shares held for publicly announced strategic reasons, including shares held by several
holders acting in concert.
For clarity, holdings not considered as restricted free float include:
• Portfolio holdings (such as pension and insurance funds)
• Nominee holdings (unless they represent restricted free float as defined by Rule 4.5.1)
• Holdings by investment companies
• ETFs
New Rule
Free float restrictions include:
• Shares directly owned by State, Regional, Municipal and Local governments (excluding
shares held by independently managed pension schemes for governments).
• Shares held by Sovereign Wealth Funds where each holding is 10% or greater. If the
holding subsequently decreases below 10%, the shares will remain restricted until the
holding falls below 7%.
• Shares held by directors, senior executives and managers of the company, and by their
family and direct relations, and by companies with which they are affiliated.
• Shares held within employee share plans.
• Shares held by public companies or by non-listed subsidiaries of public companies.
• Shares held by founders, promoters, former directors, founding venture capital and
private equity firms, private companies and individuals (including employees) where the
holding is 10% or greater. If the holding subsequently decreases below 10%, the shares
will remain restricted until the holding falls below 7%.
• All shares where the holder is subject to a lock-in clause (for the duration of that
clause).
• Shares held for publicly announced strategic reasons, including shares held by several
holders acting in concert.
• Shares that are subject to on-going contractual agreements (such as swaps) where
they would ordinarily be treated as restricted.
For clarity, holdings not considered as restricted free float include:
• Portfolio holdings (such as pension and insurance funds) *
• Nominee holdings (unless they represent restricted free float as defined by Rule 4.5.1)
• Holdings by investment companies *
• ETFs
* Where any single portfolio holding is 30% or greater it will be regarded as
strategic and therefore restricted. The shares will remain restricted until the
holding falls below 27%.
An updated version of the FTSE UK and FTSE Global Equity Index Series Ground Rules
can be accessed via the FTSE website.
FREE TRIAL OFFER: FTSE offers free one month index trials to interested clients. For further information or
general enquiries please contact us at info@ftse.com or indices@jse.co.za or call:
Client Services in UK: Tel: +44 (0) 20 7866 1810
Client Services in Europe, Middle East & Tel: +44 (0) 20 7866 1810
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2811
JSE Limited: Tel: (+27 11) 520 7106 or + (+27 11) 520 7137
Alternatively please visit our website at www.ftse.com or www.ftsejse.co.za
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Date: 18/09/2012 04:40:00 Produced by the JSE SENS Department. The SENS service is an information dissemination service administered by the JSE Limited ('JSE').
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