LISTING A BUSINESS

Joining a public market is a very important decision in the life of a business.

KEY DESIGN FEATURES

NXT is tailored to small and mid-sized businesses.

Simple and effective

NXT has a set of short, simple listing rules

Ongoing support

From an experienced community of NXT Advisors and NZX before and after listing

Periodic updates

Businesses release quarterly updates providing regular and structured information to shareholders. Immediate disclosure is required for prescribed events

Key operating milestones (KOMs)

Businesses forecast and report against KOMs which provide indications to investors of the underlying performance of the business (such as number of units sold), instead of prospective financial information

Template documents

Easy to follow template documents for listing, market announcements and results

Research and market making

All NXT companies receive market making services to promote liquidity, and independent research on each company is published on the NXT website and available publicly

BENEFITS OF LISTING

Here are some of the reasons businesses choose to list.

Capital

Ready access to capital (both initially and ongoing) for acquisitions or to fuel growth

Integrity

Increased visibility and prestige of the company and brand, improving credibility and profile with customers, suppliers and the wider public

Liquidity

Liquidity for shareholders. An objective market valuation of the business creates a tradable market for its shares

LISTING CRITERIA

To understand the size and scale of NXT businesses, here are some key listing criteria.

$10m - $100m market capitalisation once listed

If raising capital at listing (which is not mandatory) at least $5m being raised

At least 50 shareholders, where 25% of shares are in public hands

LISTING PROCESS

Meet with NZX and Appoint a NXT Advisor

We appreciate the opportunity to meet with you and learn about your business. The NZX Markets Team is on hand to talk you through listing options, process, timeline and the necessary approvals required. Generally speaking, companies should allow at least three months to prepare for a listing.

The NZX Markets Team can also help you to find a suitable NXT Advisor, who will assist you through the listing process and provide ongoing guidance on your responsibilities once listed. A NXT Advisor is an NZX approved organisation such as a corporate advisory firm or investment bank.


Appoint your Listing Team

It's important to appoint a team that you trust to represent you effectively. In addition to your NXT Advisor, a typical listing team includes:

- Legal advisor - to ensure your company is aware of its legal obligations.

- Accounting Advisor - responsible for ensuring your financial information meets all legal, regulatory and NXT Listing Rule obligations.

- Communications Advisor - to assist with your public offering, with experience in press pitching, roadshow analyst presentations, direct marketing and advertising.

Finalise your Business Plan and Determine your Strategy

The purpose of the business plan (other than to act as a road-map for all managers) is to outline to the public your company's goals, along with your desired targets or marketplace.

Your issue strategy should be based on your capital structure strategy. For example, do you need to raise capital at listing? How much capital do you need to raise? Do any existing shareholders want to sell any of their shares? Then, alongside your NXT Advisor, plan for how you are going to take your company public. Prepare the offer document (using the NXT template) to communicate to potential investors about your business


Submit Application and List

All information required for a listing application is included in the NXT Market Rules, templates and procedures, and will generally be developed with your NXT Advisor. You can submit applications to regulation@nzx.com and a member of the regulation team will be in contact to discuss your application.

The pricing and placement of your offer is usually managed by your NXT Advisor. Once this is complete, and you have approval to list from NZX, a listing date can be set. NZX will then provide a relationship manager and an onboarding service.

Being listed on NXT does not need to be daunting! Your relationship manager will help you with the ongoing obligations of being listed. This includes a range of services including online assistance in the form of searchable rules, guidance notes and best practice templates for announcements. Workshops are run throughout the year on certain topics and telephone and email assistance is provided.

LISTING COSTS

The following estimates (excluding NZX fees) are indicative and will vary depending on the nature and complexity of the listing company.

Initial Fees

NXT initial listing fees

Based on the market capitalisation of the NXT company on the day of listing (at the close).

For example, a NXT company with a market capitalisation of $10m will pay an initial listing fee of $30,000, and a NXT company with a market capitalisation of $100m will pay an initial listing fee of $97,125.

Fees are also charged by NZX Regulation based on review time and urgency sought (if applicable). Factors that may affect review time include: Quality and completeness of listing application and documentation, and number of waivers sought. While Regulation fees can vary significantly, average for new listings ranges from $20,000 - $30,000.

For a full list of NZX fees please view the Listed Issuer Fee Schedule

Professional advisor fees

Work performed by a company's NXT Advisor, and legal and accounting advisors. These fees range from $100,000 to $500,000 and are likely to vary significantly depending on the listing company.

NXT companies are not required to prepare prospective financial information (PFI). This process typically represents a significant cost for companies listing on other NZX markets.

Distributing and underwriting fees

Based on the percentage of capital being raised in an initial public offering (IPO). These fees will not apply where a company does not raise capital at listing (known as a compliance listing). This can be the case where the company has raised capital privately prior to its listing.

Other fees to consider

Initial registry fees could range from $3,000 to $15,000.

Ongoing Fees

NXT annual listing fees

The annual listing fees for all NXT companies will be $30,000.

This is a bundled fee and includes costs relating to research and market making services, which typically exceed $40,000 for a listed business.

For a full list of NZX fees for listed companies please view the Listed Issuer Fee Schedule

Ongoing professional advisor fees

Work performed by a company's NXT Advisor (if applicable), and legal and accounting advisors.

NXT Advisor fees are likely to vary significantly depending on the nature of the listing company.

Other fees to consider

Independent director fees (these are publicly disclosed in the annual reports for public companies), directors and officers insurance, registry fees (typically below $20,000 per annum) and investor relations costs.