Euronext Unveils New Market Structure, Supporting Growth of Listings

Euronext, Europe’s largest Exchange Exchange An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv An exchange is known as a marketplace that supports the trading of derivatives, commodities, securities, and other financial instruments.Generally, an exchange is accessible through a digital platform or sometimes at a tangible address where investors organize to perform trading. Among the chief responsibilities of an exchange would be to uphold honest and fair-trading practices. These are instrumental in making sure that the distribution of supported security rates on that exchange are effectiv Read this Term, has launched a number of measures to its market infrastructure, helping facilitate improvements for mid-cap companies and other listings, according to a group statement.

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The group will implement a laundry list of new measures beginning as early as June 2017, which will see targeted changes in its market structure, also yielding several alterations to its issuing, listings, and sponsors. More specifically, the changes come ahead of a change in the regulatory playing field - MiFID II MiFID II MiFID II stands for the Markets in Financial Instruments Directive, and is the second iteration of a sweeping directive. As such it is known as MiFID II. The original Markets in Financial Instruments Directive (MiFID) became effective in November 2007. It was intended as the foundation of the EU’s Financial Services Action Plan, a comprehensive project to create a single European market in financial services. MiFID is intended to create a level playing field for firms to compete in the EU’s fina MiFID II stands for the Markets in Financial Instruments Directive, and is the second iteration of a sweeping directive. As such it is known as MiFID II. The original Markets in Financial Instruments Directive (MiFID) became effective in November 2007. It was intended as the foundation of the EU’s Financial Services Action Plan, a comprehensive project to create a single European market in financial services. MiFID is intended to create a level playing field for firms to compete in the EU’s fina Read this Term.

As such, Euronext will be embracing more simplified market names, helping foster easier identification and definition of its listing and service offering towards issuers. The Free Market will become Euronext Access, which will stand as the gateway for companies seeking simplified access to listing – Euronext Access is already integrated into Euronext’s commercial offering.

Euronext Growth

Moreover, Alternext will become Euronext Growth, acting as a market dedicated to mid-caps with listing requirements adapted to their specific needs. Euronext – compartments A, B and C – will remain the group’s regulated market, and operate with no changes.

Euronext will also be opening a new compartment called Euronext Access+, which will be designed for both start-ups and SMEs. Euronext Access+ will oversee a range of operations with the aim of ensuring a smooth transition and acclimatisation to other Euronext markets.

Companies will be eligible to apply for listing on this new compartment so long as they comply with several criteria. This includes financial statements covering at least two years, including audited accounts for the previous year, a €1 million minimum float, an obligation to have a listing sponsor, and a commitment to regularly communicate towards the market.

Sponsorship

Euronext will also be fortifying the role played by listing sponsors to help improve the involvement and support available to mid-caps as they list. Consequently, the exchange will be appointing a listing sponsor for companies making their market debut on any of Euronext’s markets (Euronext Growth, Euronext Access, including its Euronext Access+ compartment) will be mandatory.

According to Stéphane Boujnah, Chairman of the Managing Board and CEO, Euronext N.V., in a statement on the changes: “Euronext’s mission is to power capital markets to finance the real economy. That means constantly adapting our exchanges and our services in order to meet the needs of European companies.”

“To make things simpler and clearer, we have decided to bring together all the exchanges we operate under a single brand and a single name: Euronext. Updating our brand identity is the outcome of discussions we initiated with stakeholders in the European financial centres where we operate."

“Any business grows by focusing on the next step in its development. We are convinced that Euronext’s exchanges and services offer excellent solutions for each step in financing the growth of European companies,” Boujnah added.