The plan will take effect in July. The rehabilitation sector contains stocks with weak financial health. According to SET criteria, firms in the sector are eligible to return to regular trading if they show positive shareholder equity, at least three consecutive quarters of net profit and more than 75-per-cent progress on debt-restructuring.

However, with imminent plans to shut down the sector, stocks in rehabilitation were earlier warned that if they failed to return to the regular sector before March 2006, they would automatically be delisted. There are 37 companies in the sector.

The SET's executive vice president, Suthichai Chitavanich, said yesterday the bourse's board had approved the cancellation of the rehab group, but had also introduced measures to reduce the impact on retail shareholders. The measures will help investors to distinguish which listed companies are healthy.

Of the 37 firms still in rehab, 19 have been there for more than two years. If they are still unqualified for normal trading, they will be delisted and shifted to a group called the "non-performing group". Their names will not appear on the trading board, but they will still be listed and subject to all SET rules and regulations.

They will be able to return to normal trading if they can meet the SET's criteria.

Eleven of the 37 companies have been in the rehab sector for more than two years and are qualified for normal trading. They will be transferred to the normal trading sector, but will have a "C" (compliance) sign to show that they are under rehabilitation, and trading in their stocks will be suspended, under an "SP" sign, until they are formally transferred from rehab.

The remaining seven have been in rehab for less than two years and will be shifted to the normal trading sector. They will be listed with "C" and "SP" signs until they have spent two years in rehabilitation. Those who still then remain unqualified for normal trading will be moved to the "non-performing group". 

Siriporn Chanjindamanee

The Nation