[Federal Register Volume 73, Number 25 (Wednesday, February 6, 2008)]
[Notices]
[Pages 7021-7022]
From the Federal Register Online via the Government Publishing Office [www.gpo.gov]
[FR Doc No: E8-2073]


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SECURITIES AND EXCHANGE COMMISSION

[Release No. 34-57239; File No. SR-NYSE-2007-98]


Self-Regulatory Organizations; New York Stock Exchange LLC; Order 
Approving Proposed Rule Change, as Modified by Amendment No. 1 Thereto, 
To Reduce From Six Months to Three Months the Period for Which a 
Company's Average Global Market Capitalization Must Exceed the Levels 
Established by the Exchange's Pure Valuation/Revenue Test

January 30, 2008.

I. Introduction

    On October 29, 2007, the New York Stock Exchange LLC (``NYSE'' or

[[Page 7022]]

``Exchange'') filed with the Securities and Exchange Commission 
(``Commission''), pursuant to Section 19(b)(1) of the Securities 
Exchange Act of 1934 (``Act'') \1\ and Rule 19b-4 thereunder,\2\ a 
proposed rule change to reduce from six months to three months the 
period for which the average global market capitalization of companies 
seeking to list on the Exchange must exceed the levels established by 
the Exchange's ``pure valuation/revenue'' test contained in Section 
102.01C of the Exchange's Listed Company Manual (the ``Manual''). On 
December 14, 2007, the Exchange filed Amendment No. 1 to the proposed 
rule change. The proposed rule change, as modified by Amendment No. 1, 
was published for comment in the Federal Registeron December 26, 
2007.\3\ The Commission received no comments on the proposal. This 
order approves the proposed rule change, as amended.
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    \1\ 15 U.S.C. 78s(b)(1).
    \2\ 17 CFR 240.19b-4.
    \3\ See Securities Exchange Act Release No. 56976 (December 17, 
2007), 72 FR 73055.
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II. Description of the Proposal

    Section 102.01C of the Exchange's Manual requires companies listing 
under the Exchange's ``pure valuation/revenue'' test to have a global 
market capitalization of $750 million. In the case of companies listing 
other than in connection with an initial public offering or a spin-off 
or upon emergence from bankruptcy, Section 102.01C provides that the 
market capitalization valuation will be determined on the basis of a 
six-month average.
    The Exchange now proposes to reduce from six months to three months 
the period over which prospective companies seeking to list on the 
Exchange must have had an average global market capitalization that 
meets the required level of $750 million. In addition, the Exchange 
proposes to amend the rule to specify that in considering the 
suitability for listing of a company pursuant to this standard, the 
Exchange will consider whether the company's business prospects and 
operating results indicate that the company's market capitalization 
value is likely to be sustained or increase over time.

III. Discussion

    After careful review, the Commission finds that the proposed rule 
change, as amended, is consistent with the requirements of the Act and 
the rules and regulations thereunder applicable to a national 
securities exchange and, in particular, with Section 6(b)(5) of the 
Act,\4\ which requires, among other things, that the rules of a 
national securities exchange be designed to prevent fraudulent and 
manipulative acts and practices, to promote just and equitable 
principles of trade, to remove impediments to, and perfect the 
mechanism of, a free and open market and a national market system and, 
in general, to protect investors and the public interest.\5\
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    \4\ 15 U.S.C. 78f(b)(5).
    \5\ In approving this proposed rule change, the Commission has 
considered the proposed rule's impact on efficiency, competition, 
and capital formation. See 15 U.S.C. 78c(f).
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    The Commission notes that the proposed rule change does not change 
the quantitative global market capitalization requirement under the 
Exchange's ``pure valuation/revenue'' test. This requirement will 
remain at $750 million global market capitalization. Rather, the 
Exchange is shortening the time period over which the average global 
market capitalization of a prospective listed company must meet this 
level. The Commission notes that the proposed rule change requires the 
Exchange to look not only at the average three month market 
capitalization of the company but to also consider whether the 
company's market capitalization is likely to be sustained or increase 
over time based on the company's business prospects and operation 
results. The Commission therefore believes that the proposed rule 
change may allow the earlier listing of companies, but at the same 
time, it is designed to ensure that the Exchange does not list 
companies on the basis of a market capitalization valuation that is 
unlikely to be sustained. In this regard, the Commission expects that 
the Exchange will scrutinize companies to ensure that it will only list 
companies that should be able to continue to meet the market 
capitalization standard.

IV. Conclusion

    It is therefore ordered, pursuant to Section 19(b)(2) of the 
Act,\6\ that the proposed rule change (SR-NYSE-2007-98), as modified by 
Amendment No. 1, be, and hereby is, approved.
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    \6\ 15 U.S.C. 78s(b)(2).

    For the Commission, by the Division of Trading and Markets, 
pursuant to delegated authority.\7\
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    \7\ 17 CFR 200.30-3(a)(12).
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Florence E. Harmon,
Deputy Secretary.
 [FR Doc. E8-2073 Filed 2-5-08; 8:45 am]
BILLING CODE 8011-01-P