The New Zealand Exchange (NZX) announced today that it has signed a memorandum of understanding (MoU) with Nasdaq. Together, the two exchanges aim to connect their capital markets, which could increase the exposure of New Zealand-based companies in the United States.
According to the statement, the terms of the memorandum highlight that both exchanges will explore opportunities to promote dual listings, depository receipts, exchange-traded funds, and broader market development initiatives.
The agreement has the possibility to enable NZX to facilitate the growth of New Zealand companies into the United States. However, they would still be able to maintain their connection to their home market.
In addition, the two exchanges are analysing whether it is possible to provide investors in both the US and New Zealand with access to a larger range of investment products. The move comes at a time when capital markets are becoming increasingly global.
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Commenting on the agreement, NZX Chair James Miller said: “We are pleased to have extended our relationship with Nasdaq and are excited about the opportunities ahead.
As NZX adopts an increasingly global outlook, today’s announcement is a significant endorsement of our strategy and complements relationships we have in place with the Singapore and Hong Kong exchanges. We look forward to working with Nasdaq to generate opportunities for investors and companies in our respective markets.”
Issuers of Nasdaq can now list on NZX
NZX Regulation, which is responsible for monitoring and enforcing the rules of the exchange’s markets, has also approved Nasdaq as a recognised stock exchange for equity listings. This means that companies that are listed on Nasdaq’s top tier equity board can now apply for a secondary listing on the New Zealand exchange.
These companies are able to list on the exchange under the foreign exempt issuer regime. This means they need to comply with the primary rules of Nasdaq and don’t have to do the same for almost all of NZX’s listing rules.