Sharechat Logo

'NXT' year for NZX's new growth market

Wednesday 12th November 2014

Text too small?

NXT, NZX's new growth focused market, is unlikely to launch this year, as companies wait for new legislation to come into effect and the quiet Christmas period approaches, the stock market operator says. 

Wellington based NZX's new NXT market and its alternative disclosure regime is effectively registered under both the outgoing Securities Act and the incoming Financial Markets Conduct Act, due to take full effect at the start of December. The less onerous market rules, designed to ease the cost of small to medium sized enterprises listing, allow companies to use key operating metrics rather than traditional financial information to measure their performance.

Until the new FMCA legislation comes into effect, would be NXT issuers must apply for individual exemptions from the Financial Markets Authority to register their prospectuses before listing.

A spokeswoman for the NZX said it wasn't aware of any companies seeking such an exemption. The stock market operator has previously said NXT's launch is dependent on companies ready to list, and expected it to be before the end of the year, although that was now looking unlikely. 

"Our expectation is that companies wanting to raise capital as part of a NXT listing will wait until after the new regime comes into affect," she said in an emailed statement. "As this leaves little time between December 1 and the traditional slow period leading up to Christmas, we would expect companies to wait until the new year. The NXT pipeline looks strong in the new year, with a mixture of new companies listing and some others that propose to move across from the NZAX."

NXT will ultimately replace the decade old secondary board, NZ Alternative Index, for which no new additions will be accepted once the NXT platform is up and running. TruScreen, which develops a cervical cancer screening system, joined the NZAX in a compliance listing this morning, following the likes of mobile payment app developers, PushPay and Lateral Corp, which both held compliance listings on the NZAX in August, before the NXT market was registered.

Under the FMA registration requirements, the NXT market has a separate website and branding from the NZX, as well as a risk warning where investors are informed of the differences between the new market and other NZX markets. The NXT market will provide investors with company research and guaranteed "market makers" to further promote confidence and liquidity on the new bourse. Listed companies will have to appoint independent directors and a dedicated 'sponsor' to provide an advisory role for the first three years of listing.

NZX will also have the right to refuse a listing and companies must show the operating metrics chosen do accurately measure the company's performance. New market companies will also be required to graduate to the NZX's main board once they reach a certain size.

Shares of NZX were unchanged at $1.19, and have fallen 4 percent since the start of the year. 


  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

Steel & Tube Fy20 Trading Update
Further Contract Win Strengthens Scott Technology’s Position In Mining Sector
China’s Assertiveness Is Becoming a Problem for Its Friends, Too
New Talisman - Chairman’s Address to AGM 2020 August 6, 2020
T&G reports its 2020 Interim Results
Gold price hits $2,000 for first time on Covid
TruScreen strengthens its market presence in central and eastern Europe
Refining NZ announces non-cash impairment
Ryman Healthcare COVID-19 update Victoria
Talisman Quarterly Activities Report to 30 June 2020

IRG See IRG research reports