Key Takeaways
- Canadian firms are increasingly choosing U.S. exchanges (NYSE/Nasdaq) for their primary listings, treating the TSX as a secondary or “stepping‑stone” venue.
- Motivations include greater liquidity, access to large U.S. indexes (e.g., S&P 500), and broader institutional investor bases.
- Barrick Mining’s move to a primary NYSE listing with a secondary TSX slot exemplifies the trend, while companies such as Xanadu Quantum and Galaxy Digital have either launched primarily in the U.S. or delisted from the TSX altogether.
- Corporate redomiciling (e.g., GFL Environmental’s shift to Miami Beach) and evaluations of U.S. relocation (Algonquin Power) are driven by index‑inclusion advantages.
- TMX Group maintains that dual listings are valuable and rejects the notion of a “primary” listing in Canada, noting 202 interlisted TSX companies as of March 31.
- Proposed S&P rule changes could let firms keep TSX‑index membership after moving listings abroad, potentially softening the impact on Canada’s capital‑market ecosystem.
- Mining financing activity on Canadian markets has fallen from >60 % to 46 % of global totals in 2024, signalling a loss of market share.
- Despite outflows, the TSX still sees sizable IPOs in mining (Lumina Metals raised >$400 million) and overall listings are rising, chiefly due to ETF launches rather than operating companies.
- Smaller sectors (biotech, health‑care) rarely use the TSX for IPOs, preferring venture‑capital routes or direct U.S. listings.
- A concurrent surge in U.S.‑led private‑equity buyouts of Canadian firms is compounding the decline in TSX‑listed operating companies.
- Most TSX delistings result from mergers and acquisitions; the rise in passive ETF holdings coupled with fewer operating stocks raises concentration and valuation risks.
- Experts warn that the shrinking base of operating public companies may soon become a major macro‑economic issue for Canada, even if the costs are not yet widely recognized.
- Addressing the structural weaknesses of Canada’s public‑market ecosystem—liquidity, index access, and incentives for domestic listings—is viewed as essential to reversing the exodus.
Barrick’s Move Illustrates a Growing Preference for U.S. Listings
Barrick Mining Corp. recently opted to list its upcoming North American spinoff primarily on the New York Stock Exchange, retaining only a secondary presence on the Toronto Stock Exchange. This arrangement positions Barrick to qualify for major U.S. indexes such as the S&P 500, thereby unlocking access to a broader pool of large, institutional investors that dominate American capital markets. The decision reflects a strategic calculation that the benefits of deeper liquidity and higher index weight outweigh the advantages of a TSX‑centric listing.
The Trend Is Not Isolated: A Pattern Emerge
Barrick’s shift is part of a longer‑term pattern observed by Laura Paglia, CEO of the Canadian Forum for Financial Markets. She argues that when companies abandon the TSX as their anchor listing, the surrounding ecosystem—investment banking, specialized financial services, and high‑pay jobs—tends to follow the capital abroad. The erosion of Toronto’s pull as a global hub, she warns, threatens the vitality of Canada’s domestic market infrastructure.
Recent Examples: Xanadu Quantum and Galaxy Digital
In the same month that Barrick announced its NYSE focus, Xanadu Quantum Technologies Ltd. launched on the Nasdaq while maintaining a TSX listing; its primary venue is New York, and the bulk of its trading occurs south of the border. Days earlier, crypto‑finance firm Galaxy Digital Inc. delisted from the TSX altogether, electing to trade exclusively on the Nasdaq. Despite having graduated from the TSX Venture Exchange to the main board in 2020, Galaxy’s U.S. share count was roughly ten times its Canadian presence by the time it left the TSX, underscoring the magnetic pull of U.S. liquidity.
Legal and Strategic Drivers Behind the Shift
Russell Drew, Canada CEO of global law firm DLA Piper, notes a recurring question among TSX‑listed firms: “How quickly can I get to Nasdaq or NYSE?” The pursuit of liquidity, additional capital, and exposure to U.S. passive‑investment flows drives many to seek a U.S. primary listing. Drew characterizes this impulse as natural, given the structural advantages of American exchanges for growth‑oriented companies.
Corporate Redomiciling for Index Advantages
Beyond changing exchange venues, some firms are relocating headquarters to secure U.S. index inclusion. GFL Environmental Inc. announced plans to move its head office from outside Toronto to Miami Beach, hoping to attract more U.S. index‑fund investors. Similarly, Algonquin Power & Utilities Corp. is evaluating a full corporate redomicile to the United States; Bank of Nova Scotia analyst Robert Hope suggested the move would be “highly positive” from an index standpoint, as U.S. passive inflows would likely outweigh any Canadian selling pressure over the long term.
TMX Group’s View on Dual Listings
Rob Peterman, chief commercial officer of the TSX at parent TMX Group Ltd., maintains that the exchange sees value in dual listings for accessing capital and liquidity. He rejects the notion of a “primary” versus “secondary” listing in Canada, stating that a firm is either listed on the TSX or not. Peterman pointed out that as of March 31, 2025, there were 202 interlisted companies on the TSX, 167 of which were also listed on U.S. exchanges, underscoring the prevalence of cross‑border listings.
Potential Rule Change to Preserve TSX Index Membership
Historically, moving a primary listing abroad forced a company out of the S&P/TSX Composite and S&P/TSX 60 indices. However, S&P has proposed a rule change that would allow firms to retain their TSX‑index membership even after listing on a foreign exchange. If adopted, this measure could mitigate the negative impact on Canada’s index‑based investment ecosystem, reducing the incentive to abandon the TSX solely for index‑access reasons.
Declining Share of Mining Financing in Canada
Laura Paglia highlighted a troubling statistic: Canada’s share of global mining company financing fell from above 60 % in earlier years to just 46 % in 2024. This decline signals a loss of market share for Canadian capital markets in the mining sector, traditionally the TSX’s strongest pillar. The trend suggests that miners are increasingly turning to U.S. or other international venues to raise the capital they need for expansion and development.
TSX Optimism Amid Notable Mining IPOs
Despite outflows, TMX officials point to signs of vitality. Lumina Metals Corp., a copper and silver producer, completed a TSX IPO earlier this week, raising more than $400 million. Peterman framed this as evidence that Canadian markets continue to grow and that Canadian companies are achieving greater global relevance, at least within the resource‑heavy segments that still favor the TSX.
Sector‑Specific Disparities: Mining Dominates, Others Lag
Brian Bloom, CEO of Toronto‑based investment bank Bloom Burton & Co., observed that biotech and health‑care firms that have raised hundreds of millions in venture capital rarely pursue an IPO on the TSX. Instead, they either remain private or seek listings on U.S. exchanges where investor appetite for high‑growth, speculative ventures is stronger. For these smaller sectors, the TSX functions more as a “junior exchange” or stepping stone rather than a destination for major public offerings.
Reevaluating the Importance of Listing Location
Bloom argued that, ultimately, the physical location of a listing may be less consequential if a company can access global capital, talent, and investors elsewhere. While redomiciling to the U.S. represents a negative trend for Canada, he suggested that Canadian firms can still attract international funding and expertise without retaining a domestic primary listing, provided they maintain strong operational ties to Canada.
Parallel Surge in U.S.-Led Privatizations
The listing exodus is being reinforced by a wave of privatizations, whereby U.S. private‑equity firms acquire Canadian businesses at an accelerating pace. This trend reduces the number of operating companies remaining on the TSX, compounding the impact of departures to U.S. exchanges. Taken together, the dual forces of outward listings and inward buyouts are shrinking the pool of publicly traded Canadian enterprises.
Delistings Driven Mostly by M&A, Listings Rising via ETFs
TMX data confirm that the majority of TSX delistings stem from merger and acquisition activity. Although the total number of listings on the TSX and its venture‑market counterpart is increasing year over year, the growth is largely fueled by the launch of new exchange‑traded funds (ETFs), not by gains in operating companies. This divergence raises concerns about the quality and depth of the market’s underlying equity base.
Concentration Risks Highlighted by Legal Scholars
Dan Wilson, chair in business law and regulation at the University of Calgary, warned in a 2025 paper that the proliferation of TSX ETFs alongside a declining count of operating companies creates significant concentration risks. Passive capital chasing a shrinking set of stocks can lead to over‑valuation and heightened volatility, potentially distorting price discovery and undermining market stability. He cautioned that the decline of operating public companies may soon evolve into a major macro‑economic issue for Canada, even if the full costs are not yet appreciated by the broader public.
The Path Forward: Repairing Canada’s Stock‑Market Foundations
Collectively, the evidence points to a need for structural reforms that bolster the TSX’s appeal: enhancing liquidity, improving index‑access rules, offering competitive incentives for domestic listings, and addressing the competitive advantages of U.S. exchanges. Without such measures, Canada risks further erosion of its public‑market ecosystem, with downstream effects on investment banking, employment, and long‑term economic resilience. As opinion pieces in the cited articles suggest, fixing Canada’s troubled stock market may be a prerequisite for broader national prosperity.