What do a Healthcare, Cryptocurrency, and Cannabis company all have in common?
They all chose to list on the NEO Exchange.
By Dino Alic, Contributing writer to GoPublicInCanada.com
Three companies in three different industries and they all chose to list on the NEO Exchange, which is operated by Aequitas NEO Exchange Inc. Let’s take a closer look at all three and discuss the reasons why with Jeffrey Stanger, Senior Advisor for Corporate Listings with the NEO Exchange.
Nobilis Health Corp (NYSE American: HLTH, NEO Exchange: HLTH) www.nobilishealth.com
Nobilis Health is the first operating cross-listed company to come to NEO. They are a Houston based full-service healthcare development and management company with operations in Texas and Arizona. With over 30 hospitals, ambulatory surgery centers, and multi-specialty clinics, Nobilis generated USD 300 million in revenue in 2017. The company was originally cross-listed on the TSX and the NYSE but voluntarily delisted from the TSX in December of 2016. Nobilis returned to the Canadian capital markets on March 7, 2018 when they listed on NEO while retaining their NYSE listing.
Harry Fleming, Nobilis Health CEO and Chairman outlined the reasons for the move: “Better access to and by investors, enabled by a dual listing in the US and Canada, will benefit our existing shareholders and our ability to raise capital in the future. NEO’s unique focus on quality liquidity and its investor outreach program will further the recognition of our true market value and allow us to grow our Canadian shareholder base. The first-rate service offered by NEO and their depth of knowledge have helped expedite this cross-listing process. We are excited about the impact this will have on our global shareholder base.”
Ether Capital Corporation (NEO Exchange: ETHC) www.ethcap.co
Ether Capital Corporation is a new listing that started trading on the NEO Exchange on April 19, 2018. Ether Capital was the resultant issuer of a Reverse Take Over of a TSX Venture listed company that starting trading as Ether Capital on NEO at the completion of the RTO. The company is an OMERS backed Toronto based technology company whose goal is to become the central business and investment hub for the Ethereum ecosystem.
Michael H. Conn, CEO of Ether commented, “As we prepare to implement our strategic vision as a regulated entity, we know that coupled with the unique insights of our leadership in financial services and blockchain technology, we will benefit from NEO’s expansive investor outreach programs and liquidity provision services.”
Maple Leaf Green World Inc. (NEO Exchange: MGW) www.mlgreenworld.com
On April 20, 2018 Maple Leaf Green World Inc. (‘MGW’), officially graduated to a senior stock exchange from the TSX Venture Exchange when it started trading on the NEO Exchange. MGW is a Calgary based company that focuses on the cannabis industry in North America with projects in British Columbia and Nevada.
Raymond Lai, CEO of Maple Leaf Green World Inc., said, “As we prepare for this next growth stage of our business, we understand the vital importance a senior listing brings in order to access capital and maintain credibility. By listing on NEO, the Company is excited to benefit from the NEO Exchange’s streamlined and well-thought through review approach towards publicly listed companies, liquidity provision services, and expansive investor reach programs.”
Let’s deconstruct the reasons for these companies choosing NEO with Bay Street veteran and listing expert, Jeffrey Stanger, Senior Advisor for Corporate Listings at the NEO Exchange.
Dino: Jeffrey, with four stock exchanges in Canada why do you see NEO as the best choice for companies to list?
Jeffrey: Thanks Dino, I have had 25 years experience in the capital markets with a large portion of that working for or with stock exchanges in corporate listings. I’ve seen and studied different offerings from stock exchanges worldwide; from long ago with the Alberta Stock Exchange, Vancouver Stock Exchange, CDNX, and TSXV to other exchanges such as the now-defunct Plus Markets Group, to the Canadian Securities Exchange and now the NEO Exchange.
NEO takes a holistic approach to provide an exchange that caters to the groups it was created for, namely companies and investors. NEO believes that what is good for one group is good for the other and have structured an exchange that provides this through their trading platform, regulatory listing structure and liquidity programs – and the added touch that many exchanges forget – Customer Service.
Dino: The readers and I would like to learn more about the liquidity programs at NEO. Can you give us an overview, Jeffrey?
Jeffrey: I’d like to start off with the Designated Market Maker (DMM) Program, which we believe is the only truly effective market making program offered by any stock exchange in Canada. Listed companies start off with building a relationship with their DMM. In turn, the DMM who uses their firm’s capital, have transparent commitments and obligations for providing liquidity in the shares of the company. They provide trading insight, stock monitoring and price stabilization in times of volatility. As well, there is the Issuer Performance Program for incentivising higher levels of liquidity. On top of that companies receive a report on their trading and the trading of the DMM on a weekly or monthly basis, whichever they choose.
Lower volatility of a stock on NEO is important as it attracts long-term investors who can confidently buy a stock of a solid company and hold it as that company grows without the anxiety that comes with holding a highly volatile stock.
Many players in the market who are looking for growth appreciate that. To finish up on our liquidity programs, NEO also has a Market Awareness program for listings. Part of that is NEO’s free real-time market data that is distributed globally to all data providers to ensure maximum investor access and visibility. Of note, investors can get real-time market data and market depth of NEO listed securities at– www.neostockexchange.com. NEO will also work with the company to tailor a package with their Trusted Service Providers for market awareness which includes:
- 1,500 investor outreach calls in the first month of listing to investments advisors in Canada.
- Online retail investor awareness programs as well as equity research.
- A tailored listings ceremony and market open with national media coverage and NEO co-advertising and news.
Dino: What about the listing process and listing standards on NEO?
Jeffrey: NEO has a streamlined listing process without the redundancies that the competitors have. NEO’s regulatory staff is efficient and helpful and provide a painless but comprehensive review of companies that list, ensuring quality of listings without the burden. Once listed, companies will have a reduced regulatory review with a timely approval window – a powerful combination.
Regarding listing standards, NEO has four standards which include an Equity Standard with the main requirement of at least $5 million in shareholder’s equity, Net Income Standard where the company is required to have a net income minimum of $750,000, a Market Value Standard which requires at least $50 million in market capitalization, and an Assets and Revenue Standard which combined must be a minimum of $50 million.
Dino: Who are the backers of NEO?
Jeffrey: Some of NEO’s founding shareholders include RBC Dominion Securities Inc., Barclay’s Capital Canada Inc., and Invesco Canada Ltd., to name a few. In total NEO’s founding institutional shareholders have total Assets Under Management of $2.4 trillion.
Dino: With all of the above what single word would you use to describe NEO?
Jeffrey: Confidence. Everything above combined gives market participants, such as institutional investors and the retail community confidence which results in lower volatility, increased real natural volume and a boost in block trades.
Thank you, Jeffrey. To learn more about NEO and listing on it see info below:
Senior Advisor, Corporate Listings
T: (416) 933-5945
C: (647) 500-0492
E: [email protected]
Next we will discuss Canadian Listing Opportunities for Family-Owned Companies in the Capital Markets.