New Zealand Alternative Exchange (NZAX) marks its third birthday this month with almost three times the number of companies and three times the market capitalisation it began with three years ago in November 2003.
The NZAX Market was designed by New Zealand Exchange Limited (NZX) as a cost-effective listing facility for small to medium sized and non-standard companies. Since inception in 2003, the NZAX has increased from 10 companies and 10 securities to 29 companies and 34 securities. Market capitalisation of the NZAX has climbed from $197 million to $529 million in three years. NZAX listed companies have raised over $155 million in capital in initial public offerings and secondary capital raisings.
In addition, several NZAX listed companies have elected to transfer to the NZSX, after experiencing growth facilitated by their NZAX listing.
One such company is Comvita Limited which transferred from the NZAX to the NZSX Market on 31 October. Comvita CEO, Brett Hewlett said, “We would encourage other companies to list on the NZAX, because it allows them to raise capital for growth and become familiar with a Listed Issuer environment in preparation for a listing on the main board.”
Just Water International Limited has used the NZAX Market for two capital raisings, the first through an IPO in May 2004 raising $8.25 million followed by a secondary capital raising of $3 million in 2005 to partly fund an acquisition.
NZX Markets Development Manager, Geoff Brown said, “Companies listed on the NZAX have realised the value of this market offering easier and cheaper capital raising, improved pricing and liquidity and enhanced brand and credibility.”
Over 20,000 trades have been executed on the NZAX Market since inception. Trade numbers increased 26% in 2005.
NZX ran a series of seminars in November to update NZAX Listed Issuers and Sponsors on recent rule changes, and to gain feedback on developing this market so that more small and medium sized New Zealand companies can leverage the NZAX as a vehicle for growth. NZX will also run a series of seminars aimed at raising the profile of NZAX listed companies early next year.
