A new stock market for small-to-medium businesses is a step closer after getting a tick from Commerce Minister Craig Foss.
Sharemarket operator NZX has been given an exemption allowing it to establish a new market with an alternative disclosure regime, that differs from the traditional continuous disclosure requirements of the NZX main board.
Foss' approval is a significant milestone in NZX's progress towards the launch of its new market, which is aimed at small to mid-sized businesses with an expected market capitalisation of $10 million to $100m.
NZX head of markets Aaron Jenkins said the proposed disclosure regime was a critical component of NZX's new market.
"It will provide investors with regular and understandable information that is tailored to the size and nature of the companies that will list on the new market," he said.
The NZX now has to apply to the Financial Markets Authority for registration of the new market and approval of the new market rules.
NZX expects to provide a further update on progress on this front at the end of August.
NZX is promising the new market will provide a number of benefits for smaller, high-growth companies including:
- Reduced costs and complexity, both during the listing process and ongoing.
- More support for companies listed on the market.
- A streamlined regulations, with simpler rules and procedures.
- Market making and research to aid efficiency and liquidity.
- Better information on companies for investors through quarterly updates, research coverage and key operating milestones.