Some ASX shares are listed on more than one stock exchange, which is most commonly referred to as a dual listing. Companies opt to list on two exchanges to benefit from additional liquidity and greater access to capital.
What do the 2 companies have in common?
Piedmont is an emerging lithium company focused on the development of its 100%-owned Piedmont lithium project in North Carolina, United States.
The company is in its early days with a recent commencement of its definitive feasibility study for its planned 160,000 tonne output lithium spodumene concentrate operation. This study is expected to be completed by mid-2021.
Mesoblast, on the other hand, is more of an investing household name and operates in the biotech sector. The company has a number of products in Phase 3 clinical trials to treat complex inflammatory diseases resistant to conventional standards of care.
While the companies operate in completely different sectors, they do have one thing in common. Both are currently unprofitable.
Piedmont aiming to become the ‘next’ US lithium producer
Piedmont aims to leverage the next global mega-trend of electric vehicles and clean energy products. In September last year, the company entered into a sales agreement with Telsa Inc (NASDAQ: TSLA). The deal sees Piedmont making its first shipments in 2022-23, with a 5-year initial term.
However, at present, the company has yet to sell anything out of the ground, let alone construct the plant required to dig and process spodumene concentrate. Piedmont is aiming to begin construction in the second half of 2021 and commence plant commissioning and production by 2022.
To help it overcome the significant capital investment required to progress from being an explorer to a producer, the company successfully completed a listing on the NASDAQ.
Mesoblast continues to burn cash
Mesoblast has a history of burning through cash and relying on additional capital raisings to stay afloat.
The company’s portfolio of Phase 3 product candidates comprises:
- Remestemcel-L for the treatment of steroid-refractory acute graft versus host disease and for moderate to severe acute respiratory distress syndrome due to COVID-19 infection.
- REVASCOR for advanced chronic heart failure.
- MPC-06-ID for chronic low back pain due to generative disc disease.
The next step after Phase 3 trials would be to seek the US Food and Drug Administration’s (FDA) approval for commercialisation.
NASDAQ listing to diversify capital raising
Both companies arguably have significant revenue potential should they be able to overcome their near-term challenges. However, additional capital may be needed on their road to profitability.
By listing on the NASDAQ, both Piedmont and Mesoblast can diversify their capital raising activities, rather than being reliant only on the domestic ASX.