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NYSE runs 'successful' trial ahead of Twitter IPO

Matthew Finnegan | Oct. 30, 2013
Seeking to avoid recurrence of Nasdaq's technical problems during Facebook floatation

The New York Stock Exchange has completed a test of its systems ahead of Twitter's IPO, aiming to avoid a re-run of the problems that plagued the launch of Facebook on rival Nasdaq's exchange.

NYSE said that a simulation of the forthcoming IPO on Saturday was "successful", with traders from a number of companies invited to place orders on its systems as part of a trial run.

"This morning's systems test was successful, and we're grateful to all the firms that chose to participate," NYSE said in a statement.

"We're being very methodical in our planning for Twitter's IPO, and are working together with the industry to ensure a world-class experience for Twitter, retail investors and all market participants."

The launch of Twitter on NYSE has been seen as coup for the exchange, with Nasdaq traditionally seen as the home for major technology company floatations.

However NYSE is keen to avoid the problems experienced by Nasdaq during Facebook's floatation last year. The IPO encountered significant disruption when trading was delayed for 30 minutes due to glitches in Nasdaq's pre-auction process software, with traders unaware of whether orders had been placed. Nasdaq was subsequently fined $10m (£6.2m) by the US Securities and Exchange Commission, while many trading companies complained of lost revenues.

The exchange experienced further problems in August after software problems caused a three-hour halt to trading, leading many to speculate that Twitter would look elsewhere for its IPO. Twitter announced earlier this month that it had chosen NYSE for its launch.

Twitter plans to price its IPO shares between $17 and $20, and estimates that the net proceeds from the sale of common stock will be approximately $1.25 billion (£0.8bn), according to an SEC filing last week. It is expected that Twitter will begin trading in early November.

 

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