JOHANNESBURG – A2X Markets, the fledging rival of the Johannesburg Stock Exchange (JSE), has received a major boost with the secondary listing of Naspers taking the combined market capitalisation of the 15 companies listed on the bourse north of R1.5 trillion.
Naspers shares will begin to be traded on A2X on the 27th of this month. The listing of Naspers presented another coup for the new exchanges after Standard Bank, AVI, Growthpoint and African Rainbow Minerals had their secondary listing on the bourse.
Kevin Brady, chief executive of A2X, said the listing of Naspers was a great endorsement for the benefits of a secondary listing.
“We are run by an experienced local team that harnesses some of the most advanced international exchange technology to provide an efficient and cost-effective trading venue to secondary listing and trade shares.
“The end-to-end costs of transacting on A2X are 50 percent lower than current trading costs in South Africa,” Brady said.
South Africa’s leading companies like Shoprite, FirstRand and Clover have their secondary listings on the Namibian Stock Exchange.
The JSE’s stranglehold on trading was disrupted last year after the entry of ZARX, 4AX, A2X Markets and Equity Express Securities Exchange, which launched their trading platforms.
A2X had at the time of its listing said it was targeting the 50 to 65 largest and most liquid on the JSE to have their secondary listing on its plartform.
Naspers chief executive Bob van Dijk said the group believed its shareholders would appreciate the added choice of trading venues.
“A2X is one of a growing number of new exchanges that are leveraging technology in an effort to reduce trading costs and increase market transparency,” Van Dijk said.
“As one of the world’s leading technology investors, we understand the value of technology and are pleased to support these efforts by also listing on A2X.”
Since opening for business, A2X has outshone its new peers.
Financial services group Sanlam and Coronation Fund Managers have also had their secondary listings on the exchange.
The company has also attracted Patrice Motsepe’s investment vehicle African Rainbow Capital (ARC). ARC, jointly managed by former chief executive of Sanlam, Johan van Zyl, and former chief executive of Sanlam Investments, Johan van der Merwe, bought an initial 20 percent stake in A2X last year.
The transaction terms also allowed ARC to hike its equity stake to 25 percent following the company securing its exchange licence.
PricewaterhouseCoopers said earlier this year that the new bourses offered a regulated environment for entities and restricted-trading programmes such as black economic empowerment structures that might previously have traded over the counter.
However, the professional services firm also said while 2018 would be a busy year for the new bourses, listings thus far have been technical in nature, with no new equity proceeds raised.