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It's the end of an era for Germany's young equity culture.
The Deutsche Brse said Thursday, Sept. 26, it will ditch the technology heavy Neuer Markt and shift the 265 companies listed there to a reorganized Frankfurt Stock Exchange by the end of 2003.
The Frankfurt-based Neuer Markt, Germany's not wholly unsuccessful effort to nurture domestic technology, was the world's fastest-growing exchange after its 1997 founding. Fueled by hype and an unprecedented surge of retail interest in stocks, the Neuer Markt index peaked at 9,665 in March 2000.
Its trading volumes have since evaporated as its value has declined by 96% owing to lax regulation and poor performing high- tech companies, which represent more than 75% of its listings.
"The Neuer Markt has suffered a lot in terms of reputation. As a brand, it needs to be exchanged," said Andreas Thmmler, managing partner of Corporate Finance Partners, a Frankfurt-based investment banking boutique.
Prior to the shift, the Frankfurt Stock Exchange, Germany's largest exchange, will be split. Companies listed on the "Prime Standard" segment of the exchange must issue quarterly reports, abide by international accounting standards, hold an analyst conference a year and provide information in English.
Smaller companies with a more domestic emphasis will be listed on the "Domestic Standard" segment, with less rigorous requirements.
The Deutsche Brse, which also owns the Frankfurt exchange, launched The Neuer Markt to compete with New York's Nasdaq as a place for fast-growing...