Nasdaq wants to introduce a minimum size for IPO
US, WASHINGTON (ORDO NEWS) — Nasdaq, an American stock exchange specializing in high-tech stocks, is introducing a minimum size for initial placements. The lower threshold will be the amount of $ 25 billion, reports Reuters.
Referring to its own sources, the agency explains that such a limit should make it difficult for Chinese companies to enter the stock market through this trading platform. According to Reuters, this step will be almost the final point in the already extremely tense financial relations between the two largest economies in the world.
Attempts to restrict the access of companies from the Middle Kingdom to the Nasdaq stock exchange made last year, the agency said. Agency sources say that American exchanges are worried about the financial opacity of the Chinese IPO and the connection of entrepreneurs from this country with major insiders. Securities of such issuers often settle in the hands of a limited circle of insiders, and their low liquidity makes these shares unattractive to large institutional investors, on whom Nasdaq relies.
At the same time, as noted by Reuters interlocutors, the exchange will not openly restrict the rights of Chinese companies. However, the requirement to attract at least $ 25 billion during the initial offering will block access to the stock market for a number of issuers from the Middle Kingdom. Of the 155 listed companies on the stock exchange since 2000, according to Renfinitiv, about 40 during the IPO did not reach the bar of $ 25 billion.
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