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TSX Venture to streamline procedures, broaden non-natural resource base

by Greg Klein | December 17, 2015

In the name of diversity, the TSX Venture wants more listings from technology, clean tech, renewable energy and life sciences. Following consultation with hundreds of stakeholders, the TMX Group TSX:X released a white paper December 17 outlining plans to streamline the regulatory process and welcome companies from a wider group of sectors. But it’s not neglecting its traditional clientele, according to the statement. “No other exchange in the world better serves early-stage natural resource companies and that will not change.”

TSX Venture to streamline procedures, broaden non-natural resource base

Photo: Halava/Wikimedia Commons

The Venture lists almost 500 non-natural resource companies already.

Three areas of priority include cutting administrative and compliance costs, increasing the investor base and liquidity, and diversifying the types of sectors “to increase the attractiveness of the marketplace.”

Among other plans, TMX will hire a sales team to woo early-stage companies across Canada and the U.S.

Some regulatory reforms would include eliminating the sponsorship requirement, which the group says could save companies between $50,000 and $100,000, as well as months of time. Also on the chopping block would be the need for shareholder approval when inactive companies propose arms-length transactions, another potential saving of $20,000 to $50,000 and months of time.

Next year the Venture intends to promote over 100 listings to fund managers, investment bankers and research analysts, and to encourage ETFs to pick up TSXV companies. American investors should find the exchange more user-friendly.

Companies languishing on the NEX board will get “additional tools” to redeem themselves, while the exchange also intends to impose stricter criteria on remaining NEX companies. Capital pool requirements will become more flexible.

Encouraging stakeholders to “continue the conversation,” the group created a new website and Twitter presence: @TMXGroup #revitalizingTSXV

Although the announcement follows months of consultation, Bloomberg noted it came just nine days after Nasdaq agreed to buy Chi-X Canada, which “handles roughly an eighth of the country’s stock trading.” TMX shares then fell about 18%, the news agency reported.

Read the white paper: Revitalizing TSX Venture Exchange.

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