NYSE Euronext expects Israeli listings this year

NYSE Euronext director: There is a fantastic economic environment in Israel. A unique market with an entrepreneurial spirit.

azrieli center 88 298 (photo credit: Courtesy)
azrieli center 88 298
(photo credit: Courtesy)
Transatlantic stock-exchange operator NYSE Euronext is confident that Israeli companies will make initial public offerings in 2010, a company executive said Monday.
“We have chosen Israel as a central part of our growth strategy,” Diederik Zandstra, NYSE Euronext executive director of international listings told The Jerusalem Post in an interview in Tel Aviv. “There is a fantastic economic environment in Israel. It is a unique market with a high entrepreneurial spirit.”
“The news on the debt crisis in Greece slowed down the comeback of the market for initial public offerings,” he said. “There is more uncertainty and greater volatility in the market. However, I am still confident of a number of deals happening this year out of the Israeli market, which will continue in 2011.”
Zandstra said he was optimistic that young Israeli companies in the hi-tech, real-estate and retail sectors would make IPOs, possibly before the summer or in the fall.
“There are a number of Israeli companies thinking about attracting international investors to seek public sources of capital on equity markets, as raising debt is becoming more expensive since bank lending, private equity and hedge-fund sources of financing have dried up during the credit crisis,” Zandstra said. “There is an outward-looking momentum for public offerings building up a backlog, which has been held back by highly volatile markets,” he said. “But the pipeline for listings is growing. We are seeing high-quality companies preparing for an IPO both in the US and Europe.”

Israeli hi-tech companies have traditionally made public offerings in the US, especially on the Nasdaq. Zandstra said easier requirements for listings would enable small- and medium-sized Israeli companies to make IPOs on the New York Stock Exchange. At the end of 2008, the NYSE lowered entry requirements for IPOs to lure companies with a market capitalization of as low as $150 million, down from $500m.
“Before, many companies went to Nasdaq because there was no other option available,” NYSE Euronext executive vice president Ronald Kent told the Post. “We hope to offer Israeli companies a similar choice to their peers in China and the US.”
Fourteen Israeli companies are listed on the NYSE, compared with 63 on the Nasdaq. Among the Israeli companies listed on the NYSE are Cellcom Israel, Amdocs, Blue Square and Delek USA
At the end of last year, there were encouraging signs for a rebound of the European IPO market, after two years of thin volume. But jitters in the equity markets, kicked off by Greece’s debt crisis, have led to a string of cancellations and postponements in recent months.
“Last year was a dreadful year for IPO expectations,” Kent said. “There are still economic and financial uncertainties weighing on markets. But this year is a much better year, with an increasing number of companies waiting in the pipeline.”
NYSE Euronext is the largest pan-European equity market, combining the former stock exchanges of France, Netherlands, Belgium and Portugal into a single market subject to European Union regulatory oversight.
The NYSE and Euronext merged in 2007 to unite the world’s two largest capital markets and offer a universal trading platform. “Exchange platforms can no longer be considered a commodity, and differentiation among exchanges is becoming increasingly important,” Zandstra said.