Nasdaq and the Tel Aviv Stock Exchange (TASE) confirmed on Wednesday they would create a private market to support small growth companies in Israel.
Many Israeli start-ups opt to be sold rather than go public due to a lack of funding as they seek to boost sales.
The proposed new platform is a market place where such firms can find institutional investors and will offer strategic advice and mentoring, networking, a secondary market for increasing liquidity and debt financing services, the exchanges said in a joint statement.
The private market, which will operate out of Tel Aviv, will have an independent management team chosen by both exchanges.
Further details of the venture will be announced in the first half of 2016.
TASE Chief Executive Yossi Beinart said the collaboration with Nasdaq, which he had flagged last week, was good news for Israel’s economy.
“For the first time we can offer Israeli companies a real solution to challenges in their growth and give them a real alternative to an exit, so that they will continue to operate as independent companies with significant operations in Israel,” he said.
TASE, which is in the process of demutualizing, also said it had agreed to deploy Nasdaq’s Genium INET technology for trading in equities, derivatives, bonds, fixed income and commodities.
This will support its efforts to attract capital both domestically and internationally, the exchanges said.
The Israeli bourse has struggled to attract and maintain companies in recent years. Equity trading volume improved in 2015 to 1.4 billion shekels ($356 million) a day from 1.2 billion in 2014. But this was still below 2010’s 2 billion shekel average.