NEX is a seperate board on the TSX Venture Exchange to create a trading forum for listed companies that have fallen from the TSX Ventures ongoing listings standards. The companies present very interesting opportunities for individuals looking to go public for reverse mergers and joint ventures. The vehicles are still trading, and have the ability to move back up to the TSX-V based on compliance. NEX companies are characterised by those that have low levels of business activity or have ceased to carry on active business will trade on the NEX board, while companies that are actively carrying on business and pursuing growth and shareholder value will remain with the main stock list of TSX Venture Exchange.
In essence, the NEX presents an opportunity as the “shells” trading on the exchange tend to have assets and the ability to become current, but often lack the funds and management to do so. The value is in merging with these companies and financing the compliance to move back up to the TSX-V. NEX companies will benefit from the support and visibility provided by a listing and trading environment tailored to their needs, with often more flexibility within the acquisition and restructuring than one would get on the main board.
This blog is meant to profile NEX listings and their goals to either merge, sell, or raise capital. The blog intends to also keep track of those that graduate to the TSX-V, as part of the NEX alumni listings.
Before NEX was created, companies that fell below TSX Venture’s ongoing listing standards were designated “inactive” and given 18 months to meet the standards or be delisted. Now, with NEX, these companies are relieved of the pressure of a delisting deadline, are more visible as potential takeover targets or investment opportunities and can continue to trade within the prestigious TMX Group of stock exchanges.
NEX Advantages at a Glance
- Simplified Rules: Companies falling below TSX Venture listing standards now have a place with simplified rules where they can trade while they seek additional opportunities to refinance, reactivate or reinvent themselves.
- Differentiates Companies: The clear separation of companies that meet and don’t meet TSX Venture standards enables investors to more easily select companies appropriate to the risk level of their investment profiles.
- Gives Shareholders Another Chance: Existing shareholders of NEX companies have another chance of making a return on their investment (compared to delisting, which terminates investment potential).
- Smoothes Listing Transitions: NEX companies continue to maintain a relationship with TMX Group, smoothing the transition to active listed status on TSX Venture Exchange when and if the opportunity arises.
- Facilitates Connections: NEX’s distinct profile facilitates connections between deal-makers exploring potential opportunities and company management examining reactivation alternatives.
- Provides a Going Public Alternative: NEX companies provide an easy-to-identify alternative entrance via a share exchange transaction for non-listed companies seeking a listing on a national exchange.
- Trades on TMX Group Technology: Trading on the NEX open auction market takes place on the same fully electronic system as TSX Venture Exchange, and is governed by identical trading rules.
- Improves the Main TSX Venture Stock List: TSX Venture Exchange, its listed companies and their investors benefit from the positive effects of an improved stock list composed of companies actively carrying on business and working to create shareholder value.
In short, if you are an NEX Company looking for a transaction or assistance, fill-out our contact form and we will assist in finding the right merger or transaction for your firm.
If you are a company that is not listed and want to become a listed company on a national exchange, we can introduce you to the right NEX candidate for your business.