Qatar Exchange today announced the formation of Qatar’s new SME Market, the QE Venture Market. The announcement was made formally at a workshop for market professionals hosted by the QE and held at the Four Seasons Hotel.
After significant preparatory work Qatar Exchange already has in place the necessary infrastructure to list and trade the securities of small and medium sized enterprises on the QE Venture Market. With the recent finalization of the QFMA listing rules the basis for the market’s operation is now in place and Qatar Exchange looks forward to welcoming companies to its market.
Qatar Exchange recognizes the importance of the SME sector which globally provides the foundation for successful economies, contributing employment opportunities, wealth creation and increased output. Qatar is no exception and Qatar Exchange has therefore developed QE Venture Market with the objective of supporting the growth of SMEs and positioning Qatar Exchange at the centre of the government’s ongoing support for this important sector which is a key element in ‘Vision 2030’. Unlike the Main Market which is designed for larger companies with established track records QE Venture Market is designed with smaller companies in mind with a more flexible disclosure and corporate governance regime. The characteristics of the market reflect the objectives of allowing SMEs to list and raise capital more easily and cost efficient and with less stringent requirements than would be the case on the Main Market whilst also retaining the trust of the investor base through a structured regulatory framework. What this means in practice is less stringent entry requirements; reduced information requirements on listing; fewer ongoing disclosure requirements and a modified corporate governance regime.
Commenting on the importance of establishing the Venture Market, Andre Went, CEO of Qatar Exchange said: “SMEs are already recognized in Qatar as a key element in the success of a growing and healthy economy. With the addition of the QE Venture Market to our product suite we are providing young and entrepreneurial companies a customized route to market to ensure they have access to the necessary funds to contribute to Qatar’s economy. However, as an Exchange we have undertaken to do more than just provide the platform; we will actively seek to assist those SMEs to prepare for their life as a public company listed on QE Venture Market.”
Being publicly listed brings benefits in terms of ability to raise capital and liquidity but for SMEs, QE Venture Market provides additional acknowledged benefits:
- A dedicated route to market for small and mid-cap companies;
- An entry route to public markets that would in other circumstances not be available;
- Creating a universe of peer group companies which can be beneficial to investor following, research coverage and ultimately maximization of valuation;
- Flexibility to develop a regulatory structure best suited to small and mid-cap companies;
- Flexibility to develop a lower cost pricing structure for small and mid-cap companies; and
- Providing an effective focal point for both issuers and investors in the small and mid-cap space
“This workshop and announcement are important steps toward the development of QE Venture Market. In the coming months and years we will be working hard with our partners in the financial community to ensure a pipeline of suitably qualified companies are able to come to market. It is expected that these companies will be SMEs in Qatar, the GCC/MENA region and internationally all of which will form an important source of new companies. To build trust in the market the companies who are listed need to be well prepared for the rigours of being a public company and everyone involved in the development and support of this market has skills to bring to the table in this regard.”, Mr. Went added.
With the announcement Qatar Exchange also unveiled a new website for QE Venture Market (www.qe.com.qa/qeventuremarket) where issuers, investors and market professionals can be briefed on the market’s key features. All necessary information and the key contact points within Qatar Exchange are also available.
The formation of this market is an important part of Qatar Exchange’s ongoing development offering capital raising opportunities for issuers and a variety of investment alternatives for the retail and institutional investor base both domestically and internationally.
