Key takeaways

• On February 2, 2018, the SEC approved a proposed rule change by the New York Stock Exchange to facilitate “direct” listings by private companies on the NYSE without a typical underwritten initial public offering.  
• Historically, a company was only permitted to do a direct listing if it: (i) previously sold common equity securities in a private placement and (ii) demonstrated that it had $100 million aggregate market value of publicly-held shares based on both an independent third-party valuation and the most recent trading price for the securities in a private placement market.
• The revised rule allows for a direct listing of a company’s common equity, even if there has been no recent trading in a private placement market, if the company’s publicly-held shares have a $250 million aggregate market value based on an independent third-party valuation.