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Budapest bourse introduces new category for sleeper shares

The Budapest Stock Exchange on Monday announced the launch of a new equities category – "T", for technical listing – that will apply to shares that generate little turnover.

"We feel it is important to draw a clearer distinction between companies that go public by combining the listing with a public transaction and those that are not involved in a public transaction and whose listing is simply a 'technical listing'.

In this way, we would also like to draw investors' attention to the difference between the risks associated with listings combined with public transactions and listings without them," said Zsolt Katona, CEO of the BSE.

By launching this new category, the BSE also aims to promote the option of technical listing, the simplest form of entering a regulated market, to companies considering going public. From category "T", it is easier to move up to a higher category later if the company carries out a public transaction.

"We are convinced that this change will enhance the prestige of categories "B" and "A" and improve the market assessment of public transactions as we are certain that sooner or later each and every company will target these higher, premium categories," Katona said.

Companies that went public in the past through technical listing and are currently included in category "B", but have no history of public transactions will have a one-year grace period to carry out a public transaction to stay in category B.