Plato Partnership Limited (“Plato Partnership”), a not-for-profit company bringing creative solutions and efficiencies to today’s equity marketplace, and Turquoise, the European multilateral trading facility, today announce their intention to develop a mechanism that allows users to call a liquidity event for less liquid securities, including small and medium-sized enterprises (SMEs).
SMEs are a vital driver of growth in the economy and raising equity capital is an essential part of their growth strategies. Delivering Turquoise Plato™ trading innovations for small and medium cap SME securities will contribute to a more attractive capital raising environment for growth companies by increasing choice of execution mechanisms that offer potential liquidity in those stocks.
The proposed ‘Event on Demand’ (EOD) mechanism will operate within the existing Turquoise Plato™ Order book, thereby minimising implementation costs for users. It is anticipated that buy-side firms, via Turquoise members, will be able to initiate an EOD to advertise liquidity for a minimum time-period for SMEs, providing a facility for increased trading in these businesses as they grow.
Mike Bellaro, Plato Co-Chair and Global Head of Equity Trading, Deutsche Asset Management, said:
“The current economic environment is making it harder than ever before for SMEs in the UK and Europe to grow. SMEs are the lifeblood of the European economy, providing 90 million jobs, yet they are held back from reaching their full potential by insufficient opportunities to access funding.
“To be successful, SMEs need to be given the time and space to develop, and we are now facilitating that with the patient, longer-term financing that only capital markets can provide. Following the already significant progress in electronic block trading with Turquoise as a partner, we are truly excited about what this new functionality can do for SMEs and look forward to developing the proposition in the coming months.”
Nej D’jelal, Plato Co-Chair and Managing Director, Head of Electronic Equities Product, EMEA at Barclays, said:
“The Plato Partnership vision has always been about improving the equity market place with end investors and market participants at the heart. ‘Event on Demand’ by Turquoise Plato™ aims to innovatively improve liquidity opportunities in SME securities by enhancing the user experience of automated trading in less liquid securities. With benefits for SMEs in mind, we are proud to be supporting this important segment of the market.”
Dr Robert Barnes, CEO Turquoise, said:
“As a market operator and trading venue, we understand from investors that the ability to trade after a company lists is a key ingredient to successful capital raising. Turquoise Plato™ offers additional execution mechanisms for the trading of SME growth companies, continuing to innovate by converting customer ideas into action.”