By Suzanne McGee and Niket Nishant
(Reuters) – Plans are underway for the Texas Stock Exchange (TXSE) to launch in 2026, following the recent submission of necessary documentation to become a national securities exchange, according to its parent company on Friday.
The company is optimistic that the U.S. Securities and Exchange Commission will greenlight their application before the year’s end, aiming to shake up an industry predominantly led by New York.
One of TXSE’s main objectives is to tackle the declining number of firms going public, attributing the trend to the hefty costs associated with listing and maintaining status on traditional exchanges.
Anne Peetz, a capital markets attorney at Reed Smith LP based in Houston, commented, “This marks a significant stride forward.”
Since unveiling the exchange’s concept this summer, details have been scarce. The critical Form 1 document, which outlines operational aspects like trading procedures, listing rules, and fees, might remain under wraps for several weeks.
Alongside its filing, the exchange announced it has amassed $161 million in funding from over fifty investors, with heavyweights like BlackRock, Citadel Securities, and Charles Schwab among them, as well as influential U.S. market makers and trading firms like Jump Trading.
Charles Schwab’s CEO, Rick Wurster, remarked, “It’s a compelling proposition,” highlighting the additional options it offers to the firm and its clientele.
TXSE is setting its sights on challenging the longstanding dominance of the Nasdaq and the New York Stock Exchange, the country’s premier securities trading venues.
The headquarters of the Texas Stock Exchange will be housed in a brand-new Dallas structure, featuring executive offices, a conference center, and a signature bell-ringing area, according to a fact sheet from the exchange.
Two analysts specialized in market structure, who requested anonymity due to lack of authorization to discuss the venture publicly, expressed that TXSE will need to deliver substantial value to compete effectively.
Reflecting on a similar effort, another new exchange, IEX, spent years trying to attract existing public companies, only to call it quits in 2019.
Peetz added, “The environment is fiercely competitive.” Firms considering a listing with TXSE “will need assurance that TXSE offers as much, if not more, compared to its competitors.”
In September, Texas Governor Greg Abbott stated that the new exchange would bolster the state’s financial influence and solidify its economic standing globally. He noted that several high-profile companies, including Elon Musk’s Tesla, have relocated their headquarters to Texas in recent years, drawn by the state’s business-friendly atmosphere.
(Reporting by Niket Nishant in Bengaluru and Suzanne McGee in New York; editing by Pete Schroeder and Cynthia Osterman)
