Among the buzz between money managers, CEOs and businessmen at the TSX Group road show, “Sarbanes Oxley” and “capital pool” seemed to be the most frequently used words. And it was a shared perception that the landmass just north of the U.S. border offers small and mid-cap companies a fountain of capital. As one gentleman told me, “Canada has appetite.”TSX stopped at the Crescent Hotel in Dallas yesterday, as part of its worldwide tour to promote its dual-tiered system – the Toronto Stock Exchange and the Toronto Venture Exchange – and to raise awareness of the opportunities for small and mid-cap companies going public in Canada.
Kevan Cowan, president of the TSX Group, addressed all attendees as lunch was served. Market News First was able to steal a few moments of his time to find out the agenda behind the year-long tour and what the company intends to accomplish.
“Our primary goal is to raise awareness that we are a world leading exchange in terms of providing a solution for small and medium enterprises. Other exchanges don’t necessarily focus on this space – this is our sweet spot,” Cowan said. “We’re trying to provide a platform that helps the micro-cap, small-cap and mid-cap companies have an opportunity to grow.”
The TSX Venture Exchange is for early stage companies, or “junior” companies, looking for smaller financing (typically between $500,000 and $20 million). The exchange offers a mentorship program for companies who may find the process of going public daunting. After meeting market requirements, companies listed on the exchange “graduate” to the Toronto Stock Exchange. More than 24 companies have graduated to the Toronto Stock Exchange in the past five years.
The Toronto Stock Exchange gives companies access to larger investment pools, more analyst coverage and corporate governance. “Senior” companies, companies with established business and a management team with experience in the public markets, can skip the Venture and begin trading on this exchange.
Ken Manget, managing director for BMO Capital Markets said the system is ideal for smaller companies looking for investor attention and capital.