SEC Approves NYSE Proposal to Facilitate Listings of Companies Without a Trading History

Sullivan & Cromwell LLP - February 16, 2018

On February 2, 2018, the SEC issued an order approving, on an accelerated basis, a proposed rule filed by the NYSE to amend Section 102.01B of the NYSE Listed Company Manual to permit the listing of qualifying private companies that are presently unable to demonstrate a sufficient valuation for listing due to the lack of a prior trading history.  Under the rule, companies that cannot provide a private placement market trading price for their stock may instead satisfy the listing requirement if they receive an independent valuation of at least $250 million.  A prior iteration of the NYSE proposal included a more extensive change to the listing requirements and would have permitted the NYSE to exercise its discretion to list a company upon effectiveness of a registration statement under the Securities Exchange Act of 1934, rather than Securities Act of 1933. That element of the NYSE proposal was withdrawn prior to the rule’s approval.  The SEC is soliciting comments on the amendment through March 1, 2018.