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December 4, 2019 Uplisting Series
Seven Benefits of UpListing to a Senior Exchange
Welcome to Part IV of our series on Uplisting to a Major Exchange. Click here for the list of our previous posts. Today, we’re going to talk about Seven Benefits of Uplisting To A Senior Exchange.
Most company CEO’s are familiar with some of the benefits of uplisting to a higher exchange. They certainly understand it will provide numerous benefits, including increased liquidity and an opportunity to raise capital on more favorable terms. However, that’s just scratching the surface. Some of the other benefits include:
1 – Better Funding Terms
It is easier to raise capital on better terms on a higher exchange. Companies that trade on the Nasdaq or NYSE are eligible to raise capital pursuant to a shelf registration. That means you can register new stock offerings, but pull the trigger and issue the stock up to two years later taking advantage of financing windows and favorable market conditions. Uplisting also enhances your company’s validity, which helps when raising capital. It lets you raise more money, more consistently, fueling company growth.
2 – Analyst Coverage
Companies traded on a major exchange have a far better chance of receiving research analyst coverage – market analysts who track the company’s stock over time and publish their opinions about it and the direction it’s going. In many ways, analyst coverage helps drive investment activity, but most investment banks do not provide coverage for OTC companies. In the early periods after uplisting, a company usually gets coverage from top analysts at different investment banks as well other independent research firms which will make your company’s stock more attractive to investors.
3 – Mergers & Acquisitions Currency
When engaged in merger or acquisition talks, your company’s stock will be viewed as a more attractive bargaining chip if it is listed on a national exchange. This will allow you to negotiate more favorable terms and less dilution for your shareholders.
4 – Trade Monitoring
Uplisting to a major exchange provides your company with regulatory oversight in terms of monitoring against potential trading violations. This will allow your company to avoid much of the short selling issues that regularly occur for companies that trade on the OTC Markets.
5 – Index Inclusion
Companies trading on senior exchanges benefit from the opportunity to be included in indices such as the NASDAQ and S&P as well as the Russell 2000 & 3000. This allows your company to receive funding from institutional investors that can only trade in companies included in certain indices, as well as enhanced credibility with other funds and investors.
6 – Market Intelligence
Nasdaq and NYSE are dedicated to providing corporate clients with successful access and interaction with the capital markets, accompanied by strategic C-suite solutions that provide market intelligence and board-level collaboration. This means you are not alone in the trading process. You can rely on the exchange and market makers to provide answers to trading questions as well as assist you in maintaining an orderly market.
7 – Visibility
UpListing to a major exchange essentially gives your company an international platform. Listed companies work closely with Nasdaq/NYSE to leverage their unique visibility assets. You can use the exchanges for shareholder meetings, roadshows or events providing for critical exposure to investors and the benefits your company has to offer.
UpListing is one of the most important tools a company with a solid business plan can utilize to help create long-term shareholder value. We can assist you in the process!
Contact info@uplisting.com to discuss a personalized strategic plan for your uplisting to a national exchange.
In part five, we’ll take a look at some examples of companies that have uplisted from OTC to major stock exchanges.
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UpListing’s Case Study from Focused Issuers
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