US exchange operator Nasdaq OMX has entered into a joint venture with SharesPost, a private shares market, to create a new platform for non-listed, high-growth companies.
The new initiative, Nasdaq Private Market (NPM), will combine Nasdaq OMX’s market and operating expertise with SharesPost’s web-based platform to facilitate access to liquidity for early investors, founders and employees. NPM will launch later this year, pending regulatory approval.
According to Nasdaq, many companies are choosing to stay private for longer, requiring fast and efficiency access to shares held by employees and investors.
NPM will allow a private company to control the marketplace for its shares, and will incorporate security, compliance and client support functions defined by Nasdaq OMX.
“The Nasdaq Private Market will provide private companies additional flexibility as they plan for their future and, at the same time, bring the investment community unique opportunities,” said Bruce Aust, executive vice president, Nasdaq OMX. “By combining our resources, expertise and reach with SharesPost’s established technology, we will bring scale, efficiency and transparency to this marketplace.”
“Nasdaq OMX has a long history of pioneering capital markets solutions for companies and creating more efficient markets,” added SharesPost founder, Greg Brogger, who will become president of NPM. “Its dedication to that mission, and SharesPost’s best-in-class trading platform, will create a new kind of private market and will help NPM solve the critical challenges facing today’s private companies.”
Full details of the new venture were not disclosed, but Nasdaq OMX will retain a majority stake in NPM.
OTC Markets slump
Meanwhile, OTC Markets Group, the operator of a market for small-cap companies, American depository receipts and non-US-listed stocks, reported total value trading of US$135.6 billion in 2012, a 41% annual drop.
According to the company’s own figures, the total number of securities available for trading dropped by 192 to 9,974 by the end of 2012.
However, OTCQX, the market’s segment for companies that will soon seek a full exchange listing, grew 27% in 2012, with 86 new companies admitted for trading.
OTCQX accounted for 16.9% of the total dollar volume of all the trading conducted by OTC Markets Group.
“In 2013, we plan to continue growing our OTCQX marketplace and expanding our data network with new redistributors,” said R. Cromwell Coulson, president and CEO of OTC Markets Group. “In addition, as the JOBS Act rules are implemented, we anticipate more companies will raise equity capital that can be traded on our marketplaces, creating visibility for companies and liquidity for their investors.”