On February 26, cannabis company (HMMJ) Cronos Group (MJN)(PRMCF) surged almost 10.8% to 9.85 Canadian dollars on news of its listing on the NASDAQ Global Market under the ticker CRON in the United States. Cronos Group expects trading to begin today.
Level 1 ADR
Cronos was already listed as a Level 1 ADR (American depositary receipt) with NASDAQ under its NASDAQ International Designation program and trading under the ticker PRMCF. However, the companies under this program trade on the OTC (over-the-counter) market, where the filing requirements are relaxed.
The NASDAQ website states that the International Designation “program does not impose SEC filing requirements or otherwise change your regulatory obligations.” While listed on NASDAQ’s OTC market, Cronos was still required to comply with its Canadian regulatory requirements.
Why is this a big deal?
To be listed on the NASDAQ Global Market, companies need to meet more stringent requirements compared to the International Designation program. The NASDAQ website states that the applicants to the NASDAQ Global Market Tier must satisfy “certain financial, liquidity and corporate governance requirements to be approved for listing.”
Next in this series, let’s see what Cronos Group management intends to achieve through this listing.