Business World

Friday 15 November 2019

Euronext market wins new 'SME growth' status

Stephane Boujnah, CEO and chairman of Euronext. Photo: Bloomberg
Stephane Boujnah, CEO and chairman of Euronext. Photo: Bloomberg
Ellie Donnelly

Ellie Donnelly

Euronext Growth, a market specifically designed for small and medium-sized enterprises (SMEs), has been registered as an 'SME Growth Market' in Ireland, Belgium, France and Portugal.

Under this status, Euronext Growth listed companies will gain from simplified market processes in two key areas of legislation: the prospectus regulation and market abuse regulation.

Among the benefits will be the requirement for lighter prospectuses at both initial and subsequent admissions to the exchanges. This will in turn reduce workloads and facilitate issuers' capacity to raise funds on capital markets.

In addition, issuers listed on an SME Growth Market benefit from a lighter insider list disclosure regime.

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For investors, these factors will materialise into more attractive opportunities to invest in SME shares and bonds, according to Euronext.

Stephane Boujnah, CEO and chairman of Euronext, said: "Becoming an SME Growth Market will further equip Euronext Growth with the necessary tools to raise the profile and visibility of listed SMEs."

He said it would strengthen Euronext's ambition "to forge a harmonised market".

In 2017, Euronext acquired the Irish Stock Exchange in what was a €137m deal, ending 224 years of independence for the Dublin exchange. While it is best known as a share exchange for domestic listed companies, the ISE was ranked as the world's number one venue for bond and investment fund listings.

The market in Dublin is currently made up of 48 companies, with a combined capitalisation of €145bn. However, most Irish SMEs raise funds via bank loans, rather than through the capital markets.

The Dublin listing rules, unlike those of continental European markets, are extremely similar to London's. The ease of shifting listings from London to Dublin has been demonstrated by the first Brexit 'refugee', UK software firm Scisys, which last year moved to Euronext Dublin to ensure continued access to European space exploration, defence and media contracts.

Meanwhile, in the past five years, around 300 small firms have listed on the various Euronext markets.

While its regulated market is mainly dedicated to larger firms, Euronext Growth is less onerous on businesses and is mainly geared toward SMEs.

Irish Independent

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