SEC approves plan to allow more direct listings on NYSE
The new system will enable tech companies and other startups to raise capital through direct listings
23 December 2020 • 11:06am
Start-ups will no longer have to pay large underwriting fees to Wall Street banks when they raise money on the New York Stock Exchange, in a move that threatens to upend how US initial public offerings have been conducted for decades.
The change, announced by the Securities and Exchange Commission (SEC) last night, marks a major departure from traditional IPOs, in which companies rely on investment banks to guide their share sales and stock is allocated to institutional investors the night before it starts trading.
On
Tuesday, the Securities and Exchange Commission approved a plan that would allow for companies to raise fresh money in direct listings.
In this new twist on direct listings, a company can issue new shares while bypassing underwriting fees that are part of the traditional IPO process.
Securities experts told Insider that the new process could mitigate problems of IPO pops, making it an increasingly more attractive option for companies looking to raise capital.
The approval for NYSE s plan is a positive sign for a similar proposal made by Nasdaq.
A year after a change was first proposed, the Securities and Exchange Commission on Tuesday finally greenlighted the New York Stock Exchange s plan to allow companies to raise capital through a direct listing.
Updated Dec. 22, 2020 2:50 pm ET
The Securities and Exchange Commission will allow companies to raise capital through direct listings, opening the door to a new alternative to the traditional initial public offering.
The SEC approved the new kind of direct listingâwhich could help startups save on bank fees and capture more of the gains in their share price when they go publicâin an order posted on its website Tuesday.
The decision was a victory for the New York Stock Exchange, which had been seeking to change its rulebook to make the new process available to companies going public.
The commission rejected arguments by an influential trade group, the Council of Institutional Investors, that had sought to block the NYSEâs plan from taking effect. The council had warned that the new kind of direct-listing process would circumvent the investor protections of traditional IPOs, and it petitioned the SECâs commissioners to review the NYSEâs proposal af
USA
December 21 2020
Just in time for the new proxy season comes this from the Rutgers Center for Corporate Law and Governance, the Council of Institutional Investors and the Society for Corporate Governance. The report is replete with helpful guidance, detailing best and emerging practices for virtual shareholder meetings. The Working Group updates its 2018 report (see this PubCo post) in light of the deluge of pandemic-induced VSMs that were convened during the 2020 proxy season. Sorry to say, but it seems likely that this new proxy season will see a repeat for the same reason at least in the first part of the season so this report should be especially useful.
Just in time for the new proxy season comes this
Report of the 2020 Multi-Stakeholder Working Group on Practices for Virtual Shareholder Meetings from the Rutgers Center for Corporate Law and Governance, the Council of Institutional Investors and the Society for Corporate Governance. The report is replete with helpful guidance, detailing best and emerging practices for virtual shareholder meetings. The Working Group updates its 2018 report (see this PubCo post) in light of the deluge of pandemic-induced VSMs that were convened during the 2020 proxy season. Sorry to say, but it seems likely that this new proxy season will see a repeat for the same reason at least in the first part of the season so this report should be especially useful.