Apart from being appealing to major enterprises, the stock exchange is increasingly accessible to small and medium-sized companies as reveals an article worth reading published in the P.T.-magazine of the Oskar-Patzelt foundation.
For instance, in April 2005 at the stock exchange Munich a specific market segment for small and medium-sized companies called M:access was set up. This new market is an extension to the already existing segments of the Freiverkehr (“Open Market”), Geregelter (“Unlisted Securities Market”) and Amtlicher Markt (“Official Market”) and is open to issuers with a minimum share capital of 2 million Euros which can present at least one year-end financial statement as a public limited company. The Munich initiative could not help spurring into action the Frankfurt stock exchange which only a few months later, in October 2005, also created its segment for small and medium-sized companies which was baptized Entry Standard.
However, this segment is limited to the Freiverkehr (“Open Market”). It appears that a third such market may be set up in Dusseldorf. As late as in the middle of last year, according to the P.T. magazine, the managing board of the stock exchange Dusseldorf had declared that small and medium-sized companies had little chance of being successful on the stock exchange due to small capital volumina, high costs and investors not willing to take high risks. In spite of this declaration the Dusseldorf stock exchange is now planning a market segment for small and medium-sized companies.
For the P.T. magazine this is one reason more to believe that there are many ways for small and medium-sized companies to raise capital on the German capital market – either in the form of nonvoting equity funds (so-called Mezzanine capital) or in the form of voting company shares (also see “Portal offers guide on Mezzanine financing”). The original article is available here.