Amsterdam, Brussels - 16 April 2015–EnterNext, the Euronext subsidiary dedicated to promoting and growing the market for small and medium sized companies today announced the launch of a commercial solution specifically designed to simplify Dutch small companies’ access to capital and provide a broader investor base for Belgian and Dutch family businesses and entrepreneurs. The initiative will draw the two financial market places of The Netherlands and Belgium closer, joining the stakeholders from the two countries, ensuring increased liquidity and more cost efficiencies for Euronext clients.
Following a detailed review of its approach to financing of the real economy in the Belgian and Dutch markets, Euronext is responding to its key stakeholders by offering one platform for Belgian and Dutch issuers and investors that remains tailored to the specific financing needs of each location.
Analyses have shown that the Belgian and Dutch environments are very complementary. In the Netherlands, whilst institutional investors have always shown strong interest in the overall market, the limited retail participation in SME investments is largely due to the specific interpretation of the Duty of care1. In Belgium, by contrast, the retail market is broader and experienced, while large institutional investors remain limited. In addition, the Belgian market benefits from a flourishing corporate bond market which is potentially attractive for Dutch companies. By joining the forces of the Dutch and Belgian markets, EnterNext intends to combine the Dutch institutional interest with the Belgian retail participation offering the full range of equity and bond listings. Developed in collaboration with banks, advisors, investors and entrepreneurs, the initiativeoffers an efficient solution for companies that are looking for more diversified sources of financing and access to a deeper investor base within an adapted regulated framework.
The aim is to offer a wide range of cost efficient possibilities for small and midcaps through public offering or private placement, via equity or bond financing. Dutch and Belgian companies will be able to report in their own domestic GAAP.
Maurice van Tilburg, CEO of Euronext Amsterdam said: “Market recovery and disintermediation are driving the demand for alternative financing. Thanks to thorough analyses we now have a clear view of the demands and the possibilities of the market places.We believe that combining the strengths of the Dutch and Belgian eco-systems will significantly increase the added value for small and medium companies. This initiative is part of EnterNext’s drive to become more pan-European and is yet another example of its ability to offer practical solutions that help entrepreneurs find efficient access to funding. It also confirms Euronext’s ambition to facilitate the financing of the real economy through market adapted initiatives. ”
Vincent van Dessel, CEO of Euronext Brussels said: “We are designing a modern and practical solution responding to the needs of our many companies and intermediaries. The listing of bonds through private placement has been a cornerstone in this evolution. We are convinced that this new step, which takes advantage of the complementarity of the Dutch and the Belgian market communities, and compensates for the weaknesses in each market, will serve as an example for further innovation.”
The commercial initiative will be built on the Euronext UTP platform that supports a single order book for all related trading and is based on Alternext Brussels. Work is being undertaken to reposition this MTF to reflect that its scope is expanded.
1 Duty of Care: Banks in The Netherlands are required to comply with standards of due care by virtue of the Dutch Act on Financial Supervision. This places additional pressure on these institutions who, as a result, are often reluctant to advise on smaller IPOs.