Roanoke Times
Copyright (c) 1995, Landmark Communications, Inc.
DATE: SATURDAY, March 7, 1992 TAG: 9203070161
SECTION: BUSINESS PAGE: A-8 EDITION: METRO
SOURCE: From staff and wire reports
DATELINE: WASHINGTON LENGTH: Medium
ETS International Inc. indicated Friday that it hopes to make the new list of emerging companies.
"We're definitely interested," said Marc McKenna, spokesman for ETS. He said ETS expects to submit its application next week. It won't be in the initial group of companies on the Amex, he said, but hopes to qualify in the near future.
ETS, whose office is on Municipal Road near the Roanoke Regional Airport, is an air pollution control and testing technology company. Its shares trade now on the Vancouver exchange in Canada and the over-the-counter market in the United States.
Dean Penley, manager of the Roanoke office of J.C. Bradford & Co., said he knew of no other companies in this region that might seek access to the new list.
But he said many customers are interested in investing in emerging growth companies. The new listing, he said, will provide more liquidity for the shares and more research information for potential purchasers.
Tyler Pugh, vice president at the Roanoke office of Wheat First Securities, said for investors it would provide a more central market for emerging companies.
The immediate effect of Thursday's action by the SEC will be to increase competition among the exchanges for smaller companies. For the American exchange, the decision holds out the hope of new profits if investors become interested in the new junior tier of stocks. The Amex recently began to reverse a steady erosion of its market share.
But, some experts worry, for the small investor the decision presents the risk of involvement in less stable companies, although executives at the American Exchange say they are taking steps to protect the unwary.
Richard C. Breeden, chairman of the commission, said the decision primarily was intended to provide more options for smaller companies to raise money and was part of a grander plan intended to make it cheaper for emerging businesses to issue stock.
"Small businesses cannot raise money unless there's a strong, secondary market thereafter," he said.
The smaller companies on the Amex will be identified next week and begin trading on March 18. They will be listed under a second tier that the exchange has dubbed the "emerging company marketplace." To identify them to investors, their ticker symbol will include the suffix "ec."
Officials at the Amex said 15 to 20 companies will be on the list, which is expected to grow to about 50 by year's end.
"It will be an incubator marketplace," said James Jones, the chairman of the American exchange.
The newly listed Amex companies must have assets of at least $2 million if they come from the over-the-counter market, or $4 million otherwise. They will be required to have a market value of at least $2.5 million.
They will also need to have issued at least 250,000 shares held by a minimum of 300 shareholders. If they come from the over-the-counter market, then their stock price cannot fall below $1; otherwise the floor is $3.
Business writer Mag Poff contributed to this story.
by CNB