(Bloomberg) — The owner of Canadas largest stock exchange is trying to make the company more enticing to technology startups amid new competition from Nasdaq Inc., the global heavyweight in tech listings.
TMX Group Ltd. wants more tech firms on its venue for small companies, the TSX Venture Exchange, with the goal of attracting companies from Silicon Valley and Canadas technology hubs, Chief Executive Officer Lou Eccleston told reporters in Toronto on Thursday. TMX is cutting administrative and compliance costs and combating the perception the Venture Exchange is only for natural-resource firms, he added.
Nasdaq recently agreed to buy Chi-X Canada, which competes with the TMX platforms and handles roughly an eighth of the countrys stock trading. Nasdaqs main U.S. exchange is home to the four biggest technology companies in the world — Apple Inc., Alphabet Inc., Microsoft Corp. and Facebook Inc. — which together have a market value of $1.9 trillion. Thats bigger than the entire $1.6 trillion Canadian equity market. Eccleston said his company can fend off Nasdaq.
Nobody is just going to walk in and hang a shingle and take business, said Eccleston, who recommends buying TMX shares after they plunged about 18 percent following news of Nasdaqs acquisition on Dec. 8. I think theres been a big overreaction. I think everybody is like, Oh no, that name is coming in.
TMXs markets, including the Toronto Stock Exchange, handle about 70 percent of Canadian equity trading volume.
The companys new initiative comes amid a renaissance in Canadas tech scene, where Ottawa-based Shopify Inc.s debut as a $2 billion stock earlier this year has stoked speculation Canada is home to more tech unicorns — or startups valued at $1 billion or more.
