Listing FAQs

• What sort of company is the NZSX designed for?
• What are the benefits of listing?
• Will I lose control of the company?
• How much will it cost to list on the NZSX?
• Are the costs of listing too high to make it worthwhile?
• How many independent directors do we need?
• How long will it take to go through the listing process?
• Our company is thinking about listing. What do we do to make it happen?
• What documentation do we need to produce, eg a prospectus?
• What are our obligations once listed?
• When should I announce to the market that we are intending to list?
• What guidance will I get from NZX on how to be compliant?

What sort of company is the NZSX designed for?

The NZSX Market is suited to large and established enterprises. On listing on the NZSX Market, companies should have an appropriately qualified board of directors and at least 500 shareholders who hold at least 25% of the shares between them. Alternatively, check out our NZAX Market.

What are the benefits of listing?

• Access to public capital to fund growth, expansion or new ventures
• Improved pricing and liquidity for your company's shares
• Enhanced brand status and credibility associated with being listed on New Zealand's premier equities market
• Positive impact on internal culture and increased focus on performance
• Increased strategic flexibility.

Will I lose control of the company?

No. You can retain control of the company through continued participation as a director and/or manager of the company and through your ownership of shares, and the associated rights attaching to those shares. All you are doing by listing is giving up a portion of your ownership to other shareholders, in exchange for capital.

How much will it cost to list on the NZSX?

The costs of raising equity through an initial public offering should be no more than 6-8% of the money raised, depending on each company's circumstances. NZX listing fees are a small part of this cost.

Are the costs of listing too high to make it worthwhile?

Every company should assess for themselves whether the benefits justify the costs of raising capital on the public markets.

Cost-efficiency is maximised for companies looking to raise $10 million or more. Companies seeking to raise $5 million and less may wish to consider listing on the NZAX Market, or other forms of corporate finance (such as debt or venture capital) as the cost-benefit ratios become less compelling.

How many independent directors do we need?

On 29 October 2003, NZX introduced new amendments to the Listing Rules which included a requirement for the board of directors of a company to contain at least two independent directors or one-third of the board to be independent directors, whichever is greater. The Listing Rules define what it means to be an "independent director".

How long will it take to go through the listing process?

The listing process (from the time you engage an organising broker to the day your securities are listed) will normally take four to six months, depending on whether it is a compliance listing (ie not raising capital, which is generally much quicker) or an initial public offering (which generally takes longer and is dependent on the size and nature of the offering).

Our company is thinking about listing. What do we do to make it happen?

NZX is developing a guide to listing on the NZSX Market, which will be published on the NZX website. This document will provide an overview of the main steps in the listing process under NZX's Listing Rules and will assist you to understand the process required.

You should also discuss whether listing is the right option for your company with your professional advisors, including your bank, accountant and/or lawyer. Once you have made the decision to list, you should contact an NZX Broker.

What documentation do we need to produce, eg a prospectus?

This depends on whether you are compliance listing (not raising capital) or conducting an IPO (initial public offering of securities). If your company is not raising capital, you will only need to complete a disclosure document, which outlines key information regarding your company's business activities, financial activities and statements, information about the returns investors can expect from your securities, and other relevant information for investment decision making. It will also include a description of the business, an explanation of the business risks and an outline of the key drivers to performance.

If you are offering securities to the public, you will need to prepare an offering document in the form of a prospectus and investment statement.

What are our obligations once listed?

The NZSX Market follows a disclosure based regime. Listed companies are required to disclose all material information to the market, in order to ensure investors and shareholders are fully informed of all material information of the company that may affect the share price.

The full list of requirements regarding disclosure is contained in the NZX Listing Rules, but key requirements are to provide:

• Annual and half year financial results
• Annual and half year reports
• Any information that may be considered "material", eg change of directors, sale of assets, profit forecasts and warnings.

When should I announce to the market that we are intending to list?

The decision to announce your intention to list should be considered carefully. Once you announce you intend to become listed, you will start to receive an increased level of attention regarding your company and your listing strategy. Some companies announce their intentions early, others leave it until the last minute.

NZX will not make any announcements relating to your application to list or your intentions to list, without first consulting with you. You should also seek guidance from a communications advisor if you are considering listing.

What guidance will I get from NZX on how to be compliant?

All new listed companies will receive a copy of the NZX Listing Rules once they list. All companies will also be assigned an NZX Client Relationship Manager, whose role is to assist companies with their interactions with NZX.