(News Bulletin 247) – For the past ten years, many listed companies have chosen to leave the regulated Euronext Paris market for Euronext Growth and its softened rules. What are the reasons for this exodus to the favorite compartment of small and medium -sized enterprises?

Fermentalg, Adux, Mcphy Energy …. if these listed companies evolve in completely different universes, they have a common point. These companies made the choice in 2024 to transfer their securities from the regulated Euronext Paris market to Euronext Growth, the compartment dedicated to small and medium -sized enterprises

This movement is called upon to continue in 2025. The 3D Prodways printing specialist sold to the transfer sirens to Euronext Growth. The Strasbourg group announced Friday, January 24, its intention to leave the regulated compartment of Euronext Paris on which it has been listed since 2017 for less restrictive skies on Friday. In December, it was the Catana company which announced its project to join Euronext Growth. The group will submit this project at the end of February to its shareholders at a mixed general meeting.

Since 2009, companies listed on a regulated market can request the admission of their shares to negotiations on Euronext Growth. If this exodus towards this compartment was still confidential in recent years – since only four companies had attempted experience in 2018 – the phenomenon increased from 2020. That year, they were 13 taking the plunge. Then in 2021, out of the 41 new quotes on Euronext Growth Paris, 15 had been made of corporate transfers listed on the regulated Euronext compartment to the ex-Alternext.

In 2023 and 2024, it was a total of 12 companies which appeared in the procession of departures of the regulated market from Euronext Paris. Several companies thus returned to Euronext Growth like the specialist in ophthalmology Nicox in April 2023 or the hydrogen specialist MCPHY in August 2024.

However, this transfer is not automatic. The company which claims to be a change of compartment to be listed on Euronext Growth must have a market capitalization of less than a billion euros and have a floating of at least 2.5 million euros.

They must also become attached to the services of a “Listing Sponsor”, which acts as a coordinator between the listed company and the market place. This “coach” is preparing the company’s IPO and aid, once listed, to comply with its information obligations. Companies have three months from the transfer to find a sponsor listing.

Other conditions prior to the transfer must be observed: the holding of an ordinary general meeting of shareholders intended to rule on this transfer project or the dissemination of two press releases, a press release at least two months before the date envisaged for the transfer . This communication aims, among other things, to warn the public and shareholders of the reasons for this operation.

Why is Euronext Growth attracting more and more?

These transfer projects all have one thing in common: that for companies to get rid of certain operating constraints specific to the Euronext Paris market. First of all, the regulatory corset surrounding the companies listed on Euronext Growth is much more loosened than on the regulated compartment of Euronext Paris.

Companies can adopt the accounting repository of their choice, either by publishing their consolidated accounts under French accounting standards or either by favoring IFRS international standards. A company listed on the regulated Euronext market must publish its consolidated accounts based on IFRS standards. Still in terms of accounts, the maximum publication deadlines are longer on Euronext Growth. A company listed on this compartment in a period of four months to publish its results of the first half and annual where a company playing on Euronext Paris will only have three months to execute.

These multiple regulatory requirements also have a cost that certain SME-ETIs cannot or no longer want to bear by being listed on a regulated market. Admittedly, the transfer in itself has a cost which is defined according to a scale depending on the market capitalization of the company, but it is a “one-shot” cost.

To these costs, it is necessary to add the fees of the various stakeholders including the listing sponsor which necessarily assists the company during this transfer process. But companies transferred to Euronext Growth quickly find their account there. By being subject to more flexible regulations, they achieve savings each year compared to a rating on Euronext Paris. A weight argument that hits the bull’s eye with this ecosystem …

What consequences for minority?

If the company in question finds an interest in changing compartment, such an operation is not neutral for private shareholders. Moreover, the press release which presents the company’s transfer project on Euronext Growth warns of the main consequences of this change of dimension on the stock market.

In matters of periodic financial information, the company’s obligations will be reduced. Only the accounts of the first half and an activity report relating to these accounts will be required within four months of the closure of the first half. The semi -annual accounts do not have the obligation to be reviewed by the statutory auditor (CAC) while on the regulated market, the accounts must be subject to a limited examination by the CACs. With regard to the annual accounts, the company will be obliged to provide four months after the closing of the financial year, an annual report (or a universal registration document integrating it) including its annual accounts (and consolidated), a management report and the reports of the auditors.

Obviously, companies will have to deliver exact, precise and sincere information, bringing to the attention of the public any information likely to significantly influence the course and any information relating to the operations of its leaders. The regulated information (and in particular privileged information) must always be disseminated effectively and in full.

In terms of shareholding development, companies listed on Euronext Growth should only communicate to the market, that the thresholds (up or down) of 50% and 90% of the capital or voting rights. On the Euronext Paris market, the levels in question are tightened. However, newly arrived companies on Euronext Growth remain subject to the same threshold crossing rules which prevailing in their original compartment for a period of three years.

The provisions for public acquisition offer applicable to the companies listed on Euronext Paris, will also remain in force during this period of three years from the effective admission date on Euronext Growth Paris. Namely, filing of a compulsory public offer:

– in the event of crossing the threshold of 30% of the capital or voting rights.

– In the event of an increase of more than 1% in less than 12 consecutive months, by a person holding alone or in concert a participation between 30% and 50% of the capital or voting rights.

With regard to an unregulated market, it could result from the transfer to Euronext Growth Paris an evolution of the liquidity of the title which could be different – or even lower – of the liquidity observed since the start of the company’s rating on the Regulated Euronext Paris market.

Is the opposite possible? The answer is yes. A company listed on Euronext Growth can play in the big leagues by requesting a transfer on the regulated compartment of Euronext Paris. The cases are rare but they exist. Over the past 11 years, only three companies have succeeded in such a feat: Genfit in 2014, Figeac Aero in 2016 and solutions 30 in 2020, 15 after its first rating on the free market – which was not yet called Euronext Access to the ‘period, after a visit to Euronext Growth.

Still stronger, Orège companies in 2013 and Voltalia in 2014 left the free market for the regulated market of Euronext Paris without going through the intermediate box of the Euronext Growth or Alternext compartment at the time.