Transcript Market of Choice

Benefits of Listing
on NYSE Euronext
Aaron Goldstein
Head of Russia and CIS Business Development
April 2008
Global Choice of Listing Venues & Products
Flexible Listing Venues Complement Capital Market Objectives
NYSE Euronext
Strategic Relationships
Americas
Europe
The world’s largest equity market
Gateway to the Euro-zone
NYSE
 Cash Equities
 Fixed Income
 ETFs
 DRs
NYSE Arca
 Cash Equities
 Equity Options
 ETFs
 DRs
Euronext
 Cash Equities
 Bonds
 ETFs
 Certificates
 Warrants
 DRs
Alternext
 Cash Equities
 DRs
Asia
 5% equity stake
Liffe
 Derivatives
 5% equity stake
2
NYSE Euronext – Global Exchange Leadership
Global Exchange
•
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1st Transatlantic Marketplace
Largest exchange by market capitalization of listed companies: $30 trillion
80 of the 100 largest companies globally
The world’s largest liquidity pool
Daily trade in equity $142 billion(1/3 of the world’s trade)/Daily Derivative LIFFE Euro 1.8
trillion
Listing venue of choice: over 4,000 listings from 55 countries
Global Source of Capital Raising
Premier Brand
Diversified Product Offering
Financial Strength
•
•
A listed company: $20bn market capitalization
AA rated
Investor Confidence - Sound Governance and Regulatory Framework
3
Value Proposition For Issuers
Listing Venue Choice
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•
Multiple entry points for issuers of any size and geography
Listing options complement issuer’s strategy over time
Enhanced Liquidity
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Access to $ and € – the world’s two leading currencies
Extended trading day
Product extensions (ETFs, Indices, Options, Futures…)
NYSE Euronext working towards fungible trading between US and Europe
Broad Investor Pool
•
•
•
Global and local investor access
Wide range of products (Equities, Bonds, ETFs, Derivatives…)
Investor outreach programs
Unique Global Visibility
•
•
•
Unparalleled Brand Association
Superior service offering
Superior peer alignment
Advocacy on Behalf of Issuers
4
Access to the World’s Largest Sources of Capital
US and Europe: key regions for raising capital and home to the largest
pools of financial assets
Total Equity Capital Raised 2007
Total Financial Assets ($ tr)
Number of IPOs
60
120
600
100
500
80
400
60
300
40
200
20
20
100
10
$56.1
Capital raised $ billion
50
0
0
Europe
United
States
Greater
China
Source: Dealogic, figures include closed-end funds
$37.6
40
30
$19.5
$14.2
0
$10.0
$5.6
United
United
States
States
Euro
Euro
Zone
Zone
Japan
Japan Emerging
Emerging
Asia
Asia
United
Other
United
Other
Kingdom
Western
Kingdom Western
Europe
Europe
Source: McKinsey, January 2008
5
NYSE Euronext: The Center for Global IPOs
Total Capital Raised through IPOs 2005-2007
NYSE Euronext: 307 New Listings in 2007
Large median IPO size in 2007, but
wide range ($ 6.4 mln to $ 6 bln)
81
80
69
68
70
Median IPO size
60
250
200
50
45
40
$ million
IPO $ Raised ($ billion)
62
59
40
28
30
150
100
25
21
14
28
10
50
18
20
23
0
14
NYSE
Euronext
0
2007
Euronext
2006
London SE
(incl AIM)
NASDAQ
Hong Kong
2005
Source: Dealogic
NYSE
London
Hong Kong
Nasdaq
* Hong Kong 2006 figures boosted by IPOs of China’s two largest banks; ICBC
and Bank of China (raised combined total of $27.2 billion).
Source: Dealogic, exchanges; figures include closed-end funds (exclude ETFs)
6
NYSE Euronext: The Center for Secondary Offerings
 NYSE Euronext is the dominant stock exchange for follow-on financing
 Euronext has raised more capital through secondary offerings than London SE,
Deutsche Boerse and Nasdaq over the past 3 years
Follow-on capital raised (2005-2007)
180
160
140
2005
2006
2007
$ billion
120
100
80
60
40
20
NYSE
Euronext
(combined*)
NYSE
Euronext
(incl
Alternext)
London SE
(incl AIM)
Nasdaq
Deutsche
Boerse
Hong Kong
Source: Dealogic * single counted
7
NYSE Euronext: Largest BRIC+K (Kazakhstan) Footprint
NYSE Euronext has attracted more international listings from emerging
economies than any other stock exchange
Average daily value traded by
BRICs companies (FY 2007)
Market capitalisation & number of
BRICs companies (end 2007)
4,500
3,500,000
120
3,000,000
100
3,500
80
3,000
4,000
2,500,000
2,000,000
60
1,500,000
40
1,000,000
$ million
market cap $ million
No. of companies
2,500
2,000
1,500
1,000
20
500,000
0
0
NYSE
Euronext
London SE
Nasdaq
500
0
NYSE
Euronext
London SE
Nasdaq
Source: Bloomberg, NYSE Euronext
8
Superior Service Offering for Issuers
Comprehensive Issuer Support Pre and Post Listing
Visibility
Advertising
Media support & Press Release Service
Retail and institutional investor targeting programs
NYSE Euronext dedicated website for issuers
Inclusion in market indices
Quarterly web-casting
Event support: full access to NYSE Euronext facilities for investor,
board meetings and product launches
Magazine coverage
Education
CEO Leadership forum
IR, CEO, Governance forums
Investor education via NYSE
Euronext websites
Dedicated Customer
Service
Information Tools
Issuer publications/newsletters
Liquidity provision
Web-based market data resource
Client service manager
eGovDirect
Governance specialist
9
NYSE Euronext
European
Platform
Euronext – key features
One single cross-border trading platform
• Integrated across four countries
• Former stock exchanges of Paris, Amsterdam, Brussels and Lisbon
Global footprint
• NYSE Euronext is the world’s first truly global marketplace
Listed instruments
• Shares
• Corporate bonds
• Depositary Receipts (GDR, ADR, EDR)
• Derivative instruments, including Convertibles, Options, Warrants and Futures
Currency of listing
• Euro - the world’s second most important currency
• Or any other major currency
Indices
• CAC 40, AEX 25, Euronext 100, FTSEurofirst…
11
Euronext’s Competitive Position in Europe
MARKET CAPITALISATION
TRADING VOLUMES
(2007)
European cash equity market capitalisation
3,500
(end 2007)
160
3,000
SWX
8%
Spanish Exchanges
11%
2,500
120
2,000
100
1,500
80
60
1,000
40
500
Deutsche Börse
14%
Million trades
140
Euronext
27%
Value traded € bilion
Borsa Italiana
7%
OMX
8%
180
London Stock
Exchange
25%
20
0
0
Euronext
• Largest equity market in Europe
London Deutsche Spanish
Borsa
Stock
Börse Exchanges Italiana
Exchange
Turnover
OMX
SWX
Group
Trades
• Largest trading platform in Europe
Source: Federation of European Securities Exchanges (FESE)
Figures include domestic & primary international listings
12
Sector Comparison Euronext vs LSE
• Euronext sector profile very similar to London Stock Exchange
• Euronext – larger in Technology, Consumer Goods, Utilities, Industrials
Euronext
Utilities
10%
Technology
3%
5%
London Stock Exchange
Consumer Goods
14%
4%
1%
Basic Materials
6%
4%
Basic Materials
12%
Consumer Goods
Consumer Services
Financials
9%
15%
10%
Oil & Gas
16%
Health Care
Industrials
11%
Oil & Gas
Technology
Telecommunications
7%
Utilities
Industrials
12%
24%
4%
Total market cap = €2,982 billion
6%
Financials
26%
Total market cap = €2,769 billion
Source: Bloomberg, Euronext & LSE data as December 2007. ICB classification, domestic &
primary listings, includes main market, SME market, equity investment instruments.
13
Unique access to European asset managers
 Euro-zone countries dominate investment fund industry in Europe - 82% of total
 Assets under management increased 9% in H1 2007 taking total to € 6.4 trillion (UCITS)
 NYSE Euronext’s European platform facilitates cross-border access
Assets Under Management
European investment fund assets
Belgium
Other Europe
7%
France
Netherlands
United Kingdom
11%
Portugal
Austria
Euronext
countries
26%
Finland
Germany
Greece
Ireland
Italy
Luxembourg
Spain
Euro-zone
(ex Euronext)
56%
United Kingdom
Czech Republic
Denmark
Hungary
Global investment fund assets
Africa
Asia & Pacific
0.4%
12%
Liechtenstein
Norway
Poland
Slovakia
Sweden
Europe
35%
Switzerland
Americas
53%
Turkey
-
EUR billion 500
1,000
1,500
2,000
UCITS – Undertakings for the Collective Investment of Transferable Securities
Source: European Fund & Asset Management Association (EFAMA) end H1 2007
14
Euronext is dominated by high quality
broker-dealers & listing agents
• Bulge bracket and panEuropean banks dominate
the marketplace
Top 25 broker-dealers and listing agents
• Euronext gives access to
the Euro-zone…as well as
US & UK based investors:
all major London based
investment banks are active
members
• Over 50% of trading by
London based brokerdealers
15
Euronext IPOs have consistently outperformed other European
exchanges over the past 3 years
IPO price performance 2005-2007
IPO size profile 2005-2007
25
350
20
300
15
250
10
%
200
USD $ m
150
5
0
-5
100
NYSE Euronext
London SE (incl AIM)
(European platform)
Deutsche Boerse
50
-
-10
NYSE Euronext
(European platform)
-15
Average % Change Price Offer/Current
London SE (incl
AIM)
Average deal size
Deutsche Boerse
Median deal size
Median % Change Price Offer/Current
Figures include main markets and SME markets
Source: Dealogic December 2007
16
Listing Requirements – Overview
Euronext
EU regulated main
market for large, mid &
small caps
* Minimum 25% shares distributed to the public
* Three-year track record required (exemption for funds)
* IFRS, US GAAP or recognised accounting standards
Ongoing obligations
* Audited FY and audited/un-audited half-year accounts
* Timely disclosure
* Two-year track record (exemption for funds)
* IFRS, US GAAP or local GAAP with reconciliation table
Alternext
Exchange-regulated
market for mid & small
sized companies
Ongoing obligations less demanding
* Audited FY accounts, un-audited half-year reports
* Simplified reporting methods
* Timely disclosure
17
Listing requirements comparison: Euronext vs London SE
Euronext*
London – Main Market
Primary listing on main market orderbook
Secondary listing on IOB
Eligible for inclusion in main indices
Excluded from main indices
Not mandatory
Yes – UK Combined Code
• Substantial transactions
No
Yes
• Related party transactions
No
Yes
Non-voting shares permitted
Yes
No
GDR listings
Primary listing requirements
Corporate governance – majority of board required to be
independent
Shareholder approval required for:
Primary listing requirements for investment companies/funds
Investment restrictions
None
10% maximum in other listed entities
(unless listed entity has 15% investment
concentration limit)
Feeder funds required to control master fund investment
policy
No
Yes
* Euronext Amsterdam entry point
18
Listing requirements comparison: Euronext vs London SE
Euronext*
London – Main Market
Requirement for spread of investment risk
No
Yes
Requirement for investment manager track record
No
Yes
Annual explanation on benefit of continued appointment of manager
No
Yes
Quarterly portfolio reports
No
Yes
Future issues of shares only above NAV
No
Yes
No (though market abuse directive applies)
Yes, limited to 14.99%
Yes
No – physical delivery
Primary listing requirements for investment companies/funds (continued)
Restrictions on share buybacks
Electronic flagging of restricted securities in settlement system
* Euronext Amsterdam entry point
19
Euronext –
The
Main Board
Euronext – The Main Board
One cross-border EU regulated market – one rule book
•
Choice of regulatory entry point to cross-border platform
Borderless
•
Companies are classified according to sector and market capitalization rather than
geographical location
Equal opportunity for international companies to join key indices
Companies from over 30 countries listed
Sound regulatory framework (but no Sarbanes Oxley!)
21
Top 10 Euronext IPOs 2007
Capital raised
(EUR)
Market cap
(EUR)
Non ferrous Metals
2,000
2,000
GGY
Equity Investment Instruments
1,314
1,314
Bureau Veritas
FRA
Business Support Services
1,078
4,378
Rexel
FRA
Industrial Suppliers
1,056
4,224
Lehman Brothers Private Equity
GGY
Equity Investment Instruments
363
363
REN
PRT
Electricity
324
1,469
AMG Advanced Metallurgical Group NLD
Non ferrous Metals
314
643
Arseus
NLD/BEL
Medical Supplies
302
320
Leo Capital Growth SPC
CYM
Equity Investment Instruments
261
261
Paris Re
CHF
Reinsurance
225
1,656
Company
Nationality Sector
Nyrstar
BEL/AUS
Conversus Capital
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Euronext Listing and IPO process
Legal
Marketing
T– 3 to 6 months
Appoint listing agent / Lead manager
Due diligence
Positioning
Required financial
statements
Valuation
Deal structure
Prepare prospectus
Presentation material and Q & A practice
T– 30 to 90 days
Apply for listing &
regulatory approval
Analyst meeting
(through listing agent)
Pre-marketing to institutions
T– 14 days
Euronext
Regulator
Listing admission
Prospectus
Road show and marketing to investors
Book building
Euronext involvement
Price fixing
Allocation
List on Euronext
Trading
Start trading
23
NYSE Alternext:
the SME Market
Alternext – The SME Market
Why Alternext?
•
More than 1m €uro-zone SMEs eligible…
…but substantially fewer than 1% listed!
Alternext is an exchange-regulated market;
•
Designed for small and mid sized companies
•
Simplified listing rules and ongoing obligations
•
Open for companies from all sectors and countries
•
Launched mid-2005
•
Broad €uro-zone access
•
Same 4-country trading platform for Euronext and Alternext
25
Alternext – Key Listing Requirements
2 year company track record (exemption for funds)
IFRS or US GAAP
• Audited FY accounts, un-audited 6 months report
Choice of Market Access:
Public offering
Private placement
Access to retail and/or qualified investors
Access to qualified investors only
Minimum free float: € 2.5m
Minimum placing: € 5m
Prospectus cleared by regulator
Offering circular
EU Prospectus Directive
Not cleared by regulator; disclosures under responsibility of the Listing
Sponsor & Issuer
• Fast track dual listing through recognised market status
• Access via offering circular for companies listed on another market
Use of Listing Sponsor mandatory
26
Alternext – sector breakdown*
Alternext has achieved its target as a broad marketplace for SMEs
Oil & Gas
Basic Materials
Construction
Electronics
Business Services
Other Industrials
Consumer Goods
Health
Consumer Services
Telecommunications
Utilities
Financials
Technology
0.0%
2.0%
4.0%
6.0%
8.0%
10.0%
12.0%
14.0%
16.0%
18.0%
* Market capitalisation, December 2007 - ICB (Industry Classification Benchmark)
27
Alternext – size profile
Distribution of companies by market capitalisation
Alternext
35%
Alternext’s target
company size of
€20m - €250m
achieved.
30%
25%
20%
15%
10%
5%
0%
0-2
2-5
5 - 10
10 - 25
25 - 50
50 - 100 100 - 250 250 - 500
500+
€m
No micro-caps…
…better liquidity
Distribution of companies by market capitalisation
AIM
25%
20%
15%
10%
5%
0%
0-2
2-5
5 - 10
10 - 25
25 - 50
50 - 100 100 - 250 250 - 500
500+
€m
Source: Euronext, LSE, December 2007
28
Alternext – key indicators
Average number of trades per stock
- FY 2007
Alternext today*
6,000
Number listed companies
120
5,000
Total market capitalisation
€ 5 billion
4,000
Average deal size
Deal size range
Sector breakdown**
3,000
€ 9.4m
2,000
€ 2.6m to € 34m
All sectors represented
1,000
-
Alternext
Alternext vs. AIM
AIM
Alternext
AIM
Hybrid: option of orderbook or
market maker
Mainly market maker dependent
Average market cap
€ 42m
€ 72m
Median market cap
€ 32m
€ 26m
P/E ratio (median)
18.2
12.8
Bid-ask spread ratio (median)
3%
7%
42.5%
50%
48%
42%
Trading model
Key indicators (Feb 2008)
Volatility – 360 day (mean)
Stocks with Analyst recommendations
Spread ratio = bid–ask spread / last price £= € 1.34
Volatility = annualized standard deviation of the relative price change for the 360 most recent trading days closing price
Source: Euronext, LSE & Bloomberg * end January 2008 ** ICB - Industry Classification Benchmark
29
Alternext: IPOs and Investor Base
Alternext: Truly Pan-European
Origin of institutions
(as of October 2007)
IPOs:
• 80% institutional investor
participation, underpinning
valuations
Canada
1%
Australia
U.S.
1%
2%
U.K.
13%
Switzerland
4%
Sweden
2%
Spain
2%
Euronext zone
58%
Luxembourg
5%
Germany
9%
Denmark
2%
Investors:
• Institutions from 14 countries
• Broad continental European
institutional take-up
• Strong US-UK acceptance
Austria
1%
Source: Lionshares
30
Alternext - Listing Sponsors
Use of a Listing Sponsor is mandatory
Two main roles as the listed company's long-term partner:
• Support the company in preparing for listing
• Ensures company fulfils ongoing obligations
No fees to be Listing Sponsor
Requirements to become a Listing Sponsor:
• 2 years relevant experience
• Liability insurance
• Fill in application form
Over 60 Listing Sponsors registered…and counting
31
Alternext Listing Sponsors
Aélios Finance
EFI
Allegra Finance
Euroland Finance
KPMG Corporate Finance
Leleux Associated Brokers
Amsterdams Effectenkantoor
Exco
L'Lione & Associés
Arkéon Finance
Fideuram Wargny
Natexis Bleichroeder
Atout Capital
First Dutch Capital
Nexfinance
Atlantic Law Llp
Aurel Leven Securities
Fortis
Nextcap
Global Equities
NIBC
Avenir Finance Corporate
Grant Thornton
Oddo Corporate Finance
Banque Degroof
H & Associés
OTC Securities
Banque Palatine
IBI
Petercam
Banque Privée Fideuram Wargny
ING Bank NV
Portzamparc Société de Bourse
Bryan, Garnier & Co
ING Belgium
PricewaterhouseCoopers
Cassagne Goirand et associés
Intuitu Capital
Rabobank
CFD Corporate Finance
Invest Securities
Résalliance & Associés
CIC Banque CIO
IXIS Midcaps
SNS Securities
Clipperton Finance
KBC Securities
Société Générale
Close Brothers
Kempen & co
Sodica
CM-CIC Securities
Kepler Equities
Teather & Greenwood
Crédit du nord
Vizille Capital Finance
Contact details: www.alternext.com
32
(1/2)
Features: KKR Private Equity Investors is a Guernsey limited partnership investment
vehicle created by KKR (Kohlberg Kravis Roberts), the US private equity firm.
- Listed closed-end fund
- 75% assets invested in KKR funds / 25% in opportunistic investments
- KKR has a 30 year track record of superior investment returns
IPO date – 3rd May 2006:
Funds raised: $5 billion
Joint global coordinators and bookrunners:
Morgan Stanley, Citigroup, Goldman Sachs
Raised over 3 times original target
Offer price: $25.00 (approx. NAV)
33
(2/2)
High net worth
individuals
15%
Broad take-up
by style and
geography:
Europe/Asia
29%
Long-orientated
hedge funds
30%
Mutual funds
55%
US
71%
Reasons KKR selected Euronext as its listing venue:
 “Euronext gives global investment focus and global investor base”
 No restrictions on investment in a single project
 Limited partnerships can list on Euronext Amsterdam
 Flexible corporate governance code
34
(1/2)
Activity:
Prologis European Properties (PEP) is an externally managed real estate investment
fund. Portfolio consists of 281 high quality distribution facilities comprising 5.4 million
sq metres of leasable space in 11 countries, valued at € 4.2 billion as of June 2006.
Deal size (22 Sept 06):
Valuation: € 2.7 bn
Offer price: € 14.35 (12% premium to
30-Jun-06 NAV)
Largest European real estate IPO
2006 & 2nd largest European real
estate IPO ever.
Funds raised: € 715m (incl. € 65m
greenshoe)
Free float: 29.5%
Deutsche Bank and Morgan Stanley – joint
global co-ordinators and bookrunners.
35
(2/2)
Broad take-up by
geography:
Australia
4%
US
22%
“The deal attracted long-only specialist real
estate investors from all around the world…”
IFR, 23 September 2006
Europe
74%
Reasons for choosing Euronext:
 Assets & continuing growth in the Euro-zone
 Only major exchange to accept ‘Fonds Commun de Placement’ (FCP) structure
• Index inclusion: AEX Real Estate, AEX Financials
36
Why the NYSE Euronext European platform?
 Gateway to the €uro-zone + Global Visibility
• Publicity: cross-border access to investors, customers & business partners
• Acquisition currency: €uro – a key currency
• Huge pool of assets under management
• Single entry point gives broad European access for listing and trading
 Leading cross-border exchange with a pan-European reach
• Top-ranked globally for capital raising
• Largest central orderbook trading volumes in Europe
• Largest exchange in Europe by market capitalisation
• Broad service offering for early stage and mature companies
37