MIDCAPS GAIN FRESH MOMENTUM FROM 47 IPOS AND 256 TRANSACTIONS ON SECONDARY MARKETS,
WITH A TOTAL €9 BILLION IN CAPITAL RAISED[1].
Paris – 10 July 2014– EnterNext, the Euronext subsidiary set up in May 2013 to promoteand grow the market for SMEs[2], has published encouraging results for its first full year in business.
To meet the goals defined in its original brief, EnterNext rolled out an action plan in all four countries where it operates, targeting three key priorities:
- expand and consolidate ties with local SMEs, both listed and unlisted, and promote the stock market as a source of finance
- develop market liquidity in midcaps by reconnecting them with investors
- rally brokers, bankers and the rest of the financial eco-system that finances SMEs
As markets welcomed a wave of new listings, EnterNext’s performance in its first year reflects quantitative and qualitative results consistent with its targets.
Expand and consolidate assistance for SMEs, both listed and unlisted
With markets showing renewed interest in SMEs, the midcap segment covered by EnterNext generated a record 47 IPOs in the period from June 2013 to July 2014. Midcaps raised a combined total of €9 billion, confirming the market’s key role in financing SMEs’ growth.
In keeping with their brief, EnterNext teams reached out to establish a positive dialogue with businesses, and have met personally with over 800 company leaders to date. For heads of listed companies, EnterNext provided expert assistance in making best use of financial markets; for companies not yet listed but whose profile made raising capital via the stock market an option, EnterNext offered information on listing opportunities.
Reconnect investors with midcaps, and rally brokers, bankers and the rest of the financial eco-system to this segment.
Investors—both individuals and institutionals—showed their interest in IPOs, with issues oversubscribed by an average 288% over the period.
Investor interest in midcaps also led to doubling in trade volumes for the segment as a whole from June 2013 to June 2014.
To boost midcap visibility and expand the pool of institutional and individual investors, EnterNext has launched two major initiatives to promote equity research—an essential driver for investment in the SMEs listed on its markets:
- reduced trading fees for brokers producing equity research on midcaps
- a partnership with Morningstar to track the performance of 220 TMT[3] shares on markets covered by EnterNext. Quantitative analyst notes for each company in this sector plus a quarterly industry review by Morningstar will be offered at no charge on its website at www.morningstar.fr/fr/ and on EnterNext’s website www.enternext.biz.
EnterNext in France: SMEs return to the market
Many listings, strong performances
In France, markets covered by EnterNext[4] have welcomed 36 IPOs raising a total of €685 million and boosting total market capitalisation by €3.2 billion since June 2013.
Companies listing since June 2013 have also turned in strong performances, with stock prices rising 8% on average since listing. The excellent performance of the CAC Mid&Small index—up 26% from June 2013 to July 2014—testifies to this segment’s solidity.
Dynamic regions, wide range of sectors
Regional businesses made a major contribution to this new momentum, accounting for 64% of IPOs in Paris and 79% of total funds raised from June 2013 to June 2014.
The wave of listings in this segment since EnterNext’s debut is also notable for the very wide range of sectors represented, with manufacturers returning to the market alongside tech-driven innovators.
EnterNext promotes French regions
During its first year EnterNext opened four regional offices, deploying teams swiftly throughout France.
Staff met with 600 companies nationwide, 66% of them based outside Paris, with some already listed and others possible listing candidates.
EnterNext has also boosted regional financial markets through a range of initiatives that included renewing its partnerships with Lyon and Marseille.
“We are very proud of the 47 companies that have listed since EnterNext was launched. It’s been a very encouraging first year, and we have every intention of building on our achievements to make EnterNext a touchstone in the SME arena. France has plenty of businesses and entrepreneurs with projects that the Bourse can help match up with sources of finance. Which, in turn, makes our results a perfect illustration of Euronext’s mission and core business—financing Europe’s real economy,” said Eric Forest, Chairman and CEO of EnterNext.
Anthony Attia, Chairman and CEO of Euronext Paris, added: “Euronext is delighted with EnterNext’s hard work and strong results. EnterNext is playing an essential role and driving a key strategic priority for Euronext, which is to become a major European centre for raising capital. Europe’s midcaps are in serious need of financial resources, and to meet that need we will continue and step up our efforts, working alongside companies to help them grow.”
[1]The €9 billion raised from June 2013 to July 2014 includes €1.8 billion raised in primary issues on equity markets, €4.1 billion raised in 199 secondary offerings of equities; and €3.1bn raised in bond issues.
[2]Small and medium-size companies
[3]Technologies, Media and Telecommunications
[4]Compartments B and C of Euronext and Alternext