Stapled Securities

Stapled securities refer to an arrangement under which different classes of securities are listed and traded as one security. Stapled securities may involve different classes of securities issued by an issuer or different issuers.

In general, stapled securities have the following characteristics:

• Different classes of securities are stapled together, listed and traded as one security.
• Issuers of stapled securities remain as separate legal entities even though their securities are stapled, listed and traded as one security.
• A stapling deed would be entered into by both issuers of stapled securities.

The main advantage of stapled securities is that the stapling arrangement enhances the value and attractiveness of these securities in their stapled form as investors could enjoy the complementary benefits brought about by both securities, through different legal, tax structures and returns.