NEW YORK, Feb 1: The Nasdaq Stock Market Inc. facing its lowest number of listed companies in 20 years, is now trying to give itself a helping hand by making it easier for firms to keep their Nasdaq address even if they trade below the required $1.00-a-share price minimum.

Nasdaq said on Thursday that it plans to extend the amount of time companies whose shares trade below $1.00 are given to boost their stock price. The move would help companies avoid being delisted from the No. 2 US stock market simply because their shares do not meet Nasdaq’s minimum listing requirement.

While many Nasdaq companies trading under $1.00 may be breathing a sigh of relief, Nasdaq is also giving itself a much-needed boost with the move.

Nasdaq touted itself as the market for the new century during the heydays of the late 1990s, but the ensuing technology and telecom bust undermined its success.

Hundreds of Nasdaq stocks are trading below $1.00, forcing Nasdaq to delist numerous companies and lose out on the revenue it gets from listing fees and selling trading data, such as stock quotes.

For now, Nasdaq cannot rely on new initial public offerings to bump up its roster. In 2002, there were 86 initial public offerings in the United States, down from 97 in 2001, 443 in 2000, and 541 in 1999, according to Dealogic.

There have been no IPOs so far in 2003.

Meanwhile, Nasdaq’s market share continues to be challenged by speedier electronic communications networks, and its $107 million upgraded traded system, SuperMontage, launched last year has yet to noticeably improve its position. Nasdaq’s global expansion plans have been scaled back, and it pulled out of its Japanese venture last year.

It also faces regulatory hurdles. Its bid for exchange status continues to languish with the Securities and Exchange Commission, which isn’t expected to move on the application until it installs a new chairman. The Nasdaq wants exchange status before it holds its own initial public offering, although it has said it would hold an IPO without it.

Nasdaq’s IPO is even questionable, pulled off track by the market downturn and its leadership is undergoing changes, as Nasdaq searches for a successor for Chairman Hardwick Simmons.

To top it off, investors remain skittish about equities. In 2002, for the first time since 1988, investors pulled more money out of stock mutual funds than they added, according to the Investment Company Institute.

This is probably the worst of all possible worlds for Nasdaq to be working in, said Jefferies & Co. Inc. analyst Charlotte Chamberlain. She follows Nasdaq stock, which currently trades on the over-the-counter bulletin board, but she does not own any of its shares.

That is certainly self-serving in terms of their revenue, but I think it makes some sense too, she said.

Richard Ketchum, Nasdaq’s president, said giving companies more time to regain compliance with listing standards was a “prudent and appropriate response” to economic conditions.

Qualified companies in compliance with core listing criteria deserve a fair opportunity to execute business plans and demonstrate full compliance in a reasonable timeframe appropriate to this challenging financial environment, he said in a statement.

It is also one of the only options Nasdaq has right now to improve business since the stock market is not making a comeback, said Robert Hegarty, vice president, securities and investments for TowerGroup.

They’ve tried to do whatever they can to sustain some semblance of momentum in this down market, he said.—Reuters