| 05 Sep 2010 |
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DFSA says no application for second-tier bourse
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The regulator of DIFCDIFC
has not yet received any information with regard to the reported second-tier exchange the centre is planning to host for the emirate's smaller enterprises."So far we don't have any information on the details," Gerald Santing, Managing Director, Markets at Dubai Financial Services AuthorityDubai Financial Services Authority, said. "It's a normal procedure that if a body would wants to start an exchange here in the DIFCDIFC we would have to look at their application. And we'll do that in a normal and professional way."
Santing, who joined the DFSADFSA in June 2010, has the overall responsibility for the DFSADFSA's regulation of Nasdaq DubaiNasdaq Dubai, the Dubai Mercantile ExchangeDubai Mercantile Exchange and other future exchanges that may receive authorisation to operate within the DIFCDIFC.
The former managing director of the Netherlands Authority for the Financial Markets however sees a second-tier exchange would be good if there is a market for it. "The AIM is a good example of an exchange where there are different standards catering to the smaller firms. If there is a market here for you to do that, then why not?" he said.
On July 20, Nasser Saidi, DIFCDIFC
Chief Economist said plans were afoot to launch an alternate market catering to small and medium-sized enterprises (SMEs), a move away from the high-profile and high-value listings that dominate Dubai's existing capital markets.Saidi said the regional private equity industry needed a second-tier market with less stringent requirements where smaller companies with revenue of $20 million to $80m could be listed.
"There is a huge opportunity for setting up a tier-two market to accommodate SMEs run by families and hundreds of well-run free zone entities operating within the UAE and across the region," said Saidi, who is also the head of external relations at the DIFC AuthorityDIFC Authority
(Difca) and the Executive Director of the Hawkamah Institute for Corporate Governance.More than just opening doors for local firms, Saidi held out the prospect that a second-tier market would serve SMEs throughout the Gulf and beyond.
"The new market will be a platform for companies from across the region. We expect such a market to give a significant boost to the private equity industry in the region which needs a viable exit route," he said.
Under the proposal, the new exchange would act in a similar fashion to London's Alternative Investment Market, allowing smaller firms to list their shares given the market's lower regulatory threshold.
While Saidi did not give details on the time frame for the establishment of the second-tier market, or indeed on its location, organisation and regulation, he did say that the plan was well advanced. "We are talking to a number of parties, gauging interest from companies. There is the issue of market infrastructure, the
issue of regulation, we're addressing all of these, it is a work in progress," he said.
By Staff
© Emirates 24|7 2010
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