A new multilateral trading facility (MTF) launched by Borsa Italiana, a subsidiary of the London Stock Exchange Group (LSEG), aims to build a stronger market for SMEs by attracting local and international institutional investors, according to Barbara Lunghi, head of mid- and small-caps, Borsa Italiana.
“We are trying to build up a community of institutional investors interested in SMEs,” she told theTRADEnews.com. “We are going to focus on Italy first, but we want international institutional investors too.”
Borsa Italiana acquired Mercato Alternativo del Capitale (MAC) as a separate business in 2008. The new MTF, AIM Italia – Mercato Alternativo del Capitale, combines MAC with AIM Italia, which is based on the LSEG's AIM market for UK SMEs. Borsa Italiana created AIM Italia following its merger with the LSE in 2007.
The union of Borsa Italiana’s two SME platforms follows work by the SME Advisory Board, founded in October 2010 to develop Borsa Italiana’s markets for SMEs. The intention, said Lunghi, was to consolidate the two platforms, which had been serving essentially the same client base, and pool their liquidity together, simplifying access to capital for SMEs.
“The model of the new MTF is very close to the AIM platform in the UK, but we have adapted the platform so that market participants will only have to concern themselves with the local regulatory framework,” she explained. “Previously, they had been required to follow the original AIM rules and the local ones simultaneously, leading to potential conflicts. We felt it was better to provide a single, clear rule set.”
AIM Italia – Mercato Alternativo del Capitale uses the listing process, shorter IPO timetable and minimum trading share of MAC and draws on AIM Italia's staff expertise and the broader investment base, which includes international institutional investors.
“This is only the first step,” said Vincenzo Boccia, chairman of the SME Advisory Board. “We will continue to work on the development of SME markets because they represent an important element for the growth of Italy, being able to create employment and innovation and ensuring sustainable growth in the mid- to long-term.”
Users can connect to the new MTF via their brokers. The new platform will use the same Tradelect technology platform as the Borsa Italiana main market until the entire bourse upgrades to the LSEG’s new MillenniumIT platform, which is due to take place in Q2 this year. The LSE itself moved onto Millennium IT in February 2011; pan-European MTF Turquoise, which is also owned by the LSEG, moved to Millennium in October 2010.