Dallas could be home to new national stock exchange

Texas Stock Exchange aims to compete with NYSE, Nasdaq

By By Holden Wilen – Staff Writer, Dallas Business Journal
Jun 5, 2024

A new national stock exchange could be coming to Dallas, a move that would further cement the city’s position as one of the primary financial centers in the United States.

Dallas-based TXSE Group Inc. announced on June 5 that it plans to launch the Texas Stock Exchange and will submit a registration with the U.S. Securities and Exchange Commission later this year. The company hopes to begin facilitating trades in 2025 and host its first listing in 2026, according to a Wall Street Journal report.

TXSE Group has raised $120 million to date from more than two dozen investors, including some of the largest financial institutions and liquidity providers in the world, such as BlackRock and Citadel Securities, as well as “prominent business leaders” from around the U.S.

CEO and founder James Lee described the plan to launch a national stock exchange in Texas as a “long-held vision.”

“Texas and the other states in the southeast quadrant have become economic powerhouses,” Lee said in a statement. “Combined with the demand we are seeing from investors and corporations for expanded alternatives to trade and list equities, this is an opportune time to build a major, national stock exchange in Texas.”

For years, Texas has led the U.S. in attracting business relocations and expansions. Texas has more Fortune 500 headquarters than any other state. There are also more than 5,200 private equity-sponsored companies in Texas, many of which are preparing to access the public markets. In addition, there are more than 1,500 publicly traded companies throughout the southeast quadrant of the U.S.

Within Texas, Dallas-Fort Worth has ascended to become a major U.S. financial center with hundreds of money managers choosing to move to or expand in the region. In December 2020, DFW surpassed the Los Angeles metro as the second-largest hub of financial workers in the U.S., trailing only New York, according to data from the U.S. Bureau of Labor Statistics.

In recent years, firms like Charles Schwab Corp. and Fisher Investments have moved their headquarters to the region. Other financial giants like JPMorgan Chase & Co., Goldman Sachs Group Inc. and Wells Fargo & Co. remain headquartered elsewhere but have chosen DFW for huge corporate campuses. And a plethora of private equity and wealth management firms continue to move to or expand in the region.

If TXSE receives regulatory approval and successfully launches the stock exchange, it would compete with the two longstanding giants in the U.S. — the New York Stock Exchange and the Nasdaq. Lee said changes in the equity markets provide an opportunity for greater alignment and more competition.

Corporate issuers and exchange-traded product sponsors are demanding more stability and predictability around listing standards and associated costs. Lee said TXSE intends to expand access to U.S. capital markets for all investors, while providing greater access and alignment for public companies and those seeking access to public capital.

“TXSE will ultimately create more competition around quote activity, liquidity and transparency, resulting in more consistent and reliable markets that benefit investors, global issuers and liquidity providers alike,” he said.

WoodRock Securities (Houston) acted as exclusive financial advisor and sole placement agent for TXSE Group Inc. Cravath, Swaine & Moore (Washington, D.C.) serves as regulatory counsel to the Texas Stock Exchange. The Dallas office of Haynes and Boone LLP served as counsel to TXSE Group Inc. in the offering and will serve as corporate counsel. PwC Consulting serves as managed services provider for TXSE Group Inc.