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ARTICLE · 04 JANUARY 2021

Primary Direct Listings

Foley Hoag LLP
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On December 22, 2020, the Securities and Exchange Commission (SEC) approved a NYSE rule that permits an issuer, at the time of an initial listing on the NYSE, to conduct a primary offering as...

United StatesCorporate/Commercial Law
Stacie S. Aarestad
Stacie S. Aarestad
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What you need to know about this IPO alternative

On December 22, 2020, the Securities and Exchange Commission (SEC) approved a NYSE rule that permits an issuer, at the time of an initial listing on the NYSE, to conduct a primary offering as part of a direct listing without conducting a firm commitment underwritten offering. On the same date, Nasdaq submitted a substantially similar rule proposal that would, if approved by the SEC, permit a primary offering in conjunction with a direct listing on Nasdaq.

How does a primary direct listing differ from a traditional IPO, and is it right for your company?

What is a direct listing anyway?

Historically, a direct listing referred to an alternative to a traditional IPO in which a company's outstanding shares were registered for resale with the SEC and directly listed on a national securities exchange (e.g., NYSE or Nasdaq) without an underwritten offering of shares. NYSE now refers to this listing method as a

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