SEC Approves NYSE Rule Changes On Listing Without An IPO

The Securities and Exchange Commission (SEC) has approved a proposal by the New York Stock Exchange (NYSE) to facilitate listing on the NYSE without a prior underwritten public offering. Section 102.01B of the NYSE Listed Company Manual (Manual) currently provides that a listed company must demonstrate at the time of listing an aggregate market value of publicly held shares of either:

• $40 million for a company that lists either at the time of its initial public offering, as a result of a spin-off or as an affiliate of an already-listed company, or
• $100,000,000 in all other circumstances

For this valuation, the NYSE relies on representations from the company’s underwriter, investment banker or other financial adviser. To value shares being listed “directly,” without an underwritten public offering, the NYSE relies on a combination of (i) an independent third-party valuation and (ii) the most recent trading price of the company’s common stock in the private