Pan-European Electronic Dealing System Planned

by Jean Moran

The most challenging step for the management of a growth company to take is when seeking a first-time stock market flotation or initial public offering. Young, entrepreneurial companies, including those in the health care sector, are taking note of plans by most European countries to improve their access to equity capital. An additional proposal is for a new, pan-European electronic dealing system (EASDAQ), featuring growth companies in all business sectors, planned to be in operation by end-1995.

The European Association of Securities Dealers, launched late in 1994, is involved in a cooperative venture to aid young cash-seeking enterprises, especially fast-growers in the high-technology, biotechnology and bioscience sectors. Created by the Capital Markets Working Group, including US and European stock market participants brought together by the European Venture Capital Association and backed by the European Commission, it aims "to promote equity investment in growth enterprises." the EASD's Jonathan Freeman says this is an important initiative in view of the European Commission Directives on financial services, which must be implemented this year. Just as the European Medicines Evaluation Agency aims to harmonize EU regulatory requirements, these financial directives will help evolve a system of mutual recognition for financial transactions, and facilitate cross-border trading in stocks and shares, he says.