Thesis: Analysis of the Efficiency and the Future of the Foreign Cross-Listing

II. Geography of the Foreign Cross-Listing

II. 1. Methodology for the Creation of the Sample

II.1.a. Sources

Different sources had been used and cross-checked for the creation of the sample, therefore allowing us to develop our foreign cross-listing analysis.

This analysis focus on 15 stock exchanges (4 North American, 11 Western European, 1 Japanese, 1 Australian) located in 15 developed countries, and representing 85.31% of the world total trading value as of July 2008 YTD²⁶, i.e. US$49,856,092 million²⁷.

#13: Map of the Stock Exchanges Selected for the Analysis

²⁶ YTD means Year-to-date, as of July 2008

27

Calculated with data from the World Federation of Exchanges

#14: Stock Exchanges Share of Worldwide Volumes July 2008 YTD

	Share inTotal	Western	Share inTotal		Share inTotal
Americas	Trading Value	Europe	Trading Value	Asia-Oceania	Trading Value
Nyse	35.16%	L.S.E	7.81%	Tokyo SE	6.04%
Nasdaq	14.69%	Deutsche Bôrse	4.36%	ASX	1.49%
Nyse Alternext	0.66%	Euronext	5.10%
TSX	1.90%	Paris
		Amsterdam
		Brussels
		SWX	1.76%
		OMX	1.56%
		Borsa Italiana	1.88%
		BME	2.89%

Source: World Federation of Exchanges

In a first step, we used stock exchanges' websites in order to get the complete lists of all foreign companies listed on each places.

4 Nyse (New York Stock Exchange)

4 Nasdaq

4 Nyse Alternext, former Amex (American Stock Exchange)

4 TSX and TSX Venture (Toronto Stock Exchange)

4 Euronext-Alternext Paris, Amsterdam, Brussels

4 L.S.E-AIM

4 Deutsche Biirse

4 SWX/VTX (Swiss Stock Exchange)

4 OMX Nordic Exchange (Stockholm, Copenhagen and Helsinki)

4 Borsa Italiana

4 BME (Bolsas y Mercados Espafioles)

4 ASX (Australian Stock Exchange)

4 TSE (Tokyo Stock Exchange)

After a precise analysis and cross-check with several tools like Bloomberg and ThomsonReuters Datastream, we had arrived to a final sample composed of 1,347 foreign cross-listing cases.

However it is important to notice that the figure 1,347 includes cases where a company owns multiple foreign cross-listings. The company ArcelorMittal is one of these cases with listings on Euronext Paris, Euronext Brussels, Euronext Amsterdam, Bourse du Luxembourg, BME Madrid and on the Nyse.

Afterwards, as regards of the analysis of data such as the performances, the volumes, the sales or the net incomes, the sample had been reduced to companies providing daily trading information with tools like Bloomberg and ThomsonReuters Datastream.

II.1.b. Statements and Assumptions Regarding the Analysis

In this analysis,

4 If a company is listed on different stock exchanges belonging to the same country, e.g. Nyse/Nasdaq or Frankfurt/Xetra, we had only considered it once.

4 If a company owns on the same stock exchange different kinds of financial instruments (e.g. class A and class B shares, different kinds of ADR, shares and ADR), we had only considered it once. For instance, this was the case of the Japanese companies Torray Industries and Fujitsu listed on the L.S.E.

4 In the sample, we consider DLCs (Dual-Listed Companies).

4 As regards listings in Germany (Frankfurt and XETRA), the quasi totality of listed companies in the world are proposed to the trading by the operator Deutsche Biirse, i.e. a total of 11,355 German and foreign companies. However, in this research we had only considered companies having initiated by themselves foreign cross-listings in Germany.

The following cases had been excluded from the sample,

4 ETF (Exchange-Traded Funds) or index trackers, e.g. Lyxor ETFs, iShares, PowerShares, and so on

4 Companies which are not listed in their (or at least one of their) incorporation country(ies)

4 OTC (Over-the-Counter) traded shares

4 Non-sponsored Depositary Receipts (DRs)

Stock Exchange

TSX 34 2173 12 1 2

SWX 60 4 16 2 12 20 6 251 7 1 7 135 6 141 392 36,0%

OMX 3 3 1 676 7 0 7 682 1,0%

BME 1 1 1 1 151 1 5 29 34 192 17,7%

Borsa Italiana 1 6 17 12 1 1 3 286 41 1 42 328 12,8%

Tokyo SE 8 1 1 3 2 1 1 1 2271 18 2 20 2295 0,9%

ASX 8 10 2024 18 15 33 2056 1,6%

Nyse 2869

Nasdaq 2895

Nyse Alternext Amex) 759

Euronext Amsterdam 2 2 142 4 7 2 9 1 2 29 6 35 196 17,9%

Euronext Brussels 4 187 6 1 11 8 19 237 8,0%

Euronext Paris 15 8

Deutsche Börse 3 1 2 1 5 1307 3 2 1 2 2 1 23 7 30 1336 2,2%

L.S.E 31

Origin

Sc

U.S Canada NL Belgium France Germany U.K Swiss Spain Italy Japan Australia

andinav_ia

36

42

76

62

4 3 3 5 1 3 7 10 72 61 133 3200 4,2%

6 1 9 9 26 5 4 5 5 19 5 170 148 318 3620 8,8%

7 3 9 1810 5 4 17

9

673 3 11 1 0 2 1 50 15 65 756 8,6%

2 1 65 2 67 862 7,8%

36

26

Total from
MEDC
Countries

154 156 310 2333 13,3%

75 18 93 2369 3,9%

Total from
Emerging
Countries

Total
Cross-
Listings

# of local
companie
s listed

% of foreign cross- listings

3,5%

2,4% 3,9%

10 55 79 873 474 1347

1,1% 6,3% 9,0% 100%

11.2. Presentation of the Results

Total Listings	166	224	55	17	66	61	89	11	25		15	Degree of cross-listing
2,6%	10,3%	38,7%	9,1%	9,8%	4,7%	4,9%	4,4%	3,7%	9,9%		Weight / total
19,0%	25,7%	6,3%	1,9%	7,6%	7,0%	10,2%	1,3%	2,9%	1,7%

#15: Geographic Distribution of Foreign Cross-Listings from the MEDC Countries²⁸

#16: Geographic Distribution of Foreign Cross-Listings from non-MEDC Countries

Origin

Stock Exchange

Nyse Nasdaq

Nyse Alternext (Amex)

TSX

Euronext Amsterdam Euronext Brussels

Euronext Paris

Deutsche Börse

L.S.E SWX OMX BME Borsa Italiana

Tokyo SE

ASX

Total Listings

Lux.

Greece	Ireland	Austria	Lichtens Portugal tein	Russia	Turkey	Eastern Europe	China	India	South Korea	Taiwan	Pakistan	Indonesi a	Singap.	New Zealand	Africa / Middle East	Israel	South Am.	1
3	4		1		5	1	1	20	10	8	5		2		1	6	3	77	1
	3								1	1	1			1		5	42	6
								1									1
								4							2	9		3	4
									2										4
																1	3		5
																9		1
	4				3														2
5	1		1		24	9	12	7	22	13	9	3	1	1		42	4		1
		1		2												2
																		29	1
										1			1
														1	12	2			19
8	12	1	2	2	32	10	13	32	35	23	15	3	4	3	15	76	53	116