Hiventures partners with Budapest bourse to support IPOs

Hiventures partners with Budapest bourse to support IPOs
By Levente Szilagyi in Budapest September 20, 2019

State-owned venture capital fund Hiventures, the venture capital fund manager of the Hungarian Development Bank (MFB), signed a cooperation agreement with the Budapest Stock Exchange (BSE) on supporting companies planning IPOs on September 19.

The agreement was signed in the framework of the bourse's BET50 conference, an annual meeting of mid-sized companies. The BSE organised the conference for corporate executives of medium-sized enterprises for the fourth time.

Hiventures will pick companies it deems bourse-ready from its portfolio and ready them for inclusion on the stock exchange's Xtend market.

The BSE launched the platform for medium-sized companies in 2017. Going public on the platform does not require an IPO and can typically take place after raising private capital, an ideal solution for start-ups. 

Companies can file their annual accounts under the local accounting standards, and not the IFRS. The Xtend platform can serve as the springboard for advancing to the premium category 

Hungary's bourse, in comparison to others in the region, remains small with a market capitalisation $28.7bn. The BSE sees some 400 mid-cap companies in Hungary as suitable for listing, but in the last couple of years, only a handful of companies went public.

Central bank governor Gyorgy Matolcsy called in his keynote speech for the introduction of Hungarian banks and state-owned companies to the BSE.

The National Bank acquired more than 75% of the bourse for €13.2bn in 2015 from CEESEG, a unit of the Vienna Stock Exchange, which held 50.46% of the shares, while the Österreichische Kontrollbank owned 18.35%.