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2 UTAH FIRMS JOIN NEW STOCK MARKET

The American Stock Exchange launched a new market this week for small growth stocks that may allow new and developing companies to raise capital and gain visibility among investors and analysts.

Two Utah companies are among the 22 that began trading shares on the new market when Richard C. Breeden, chairman of the Securities and Exchange Commission, rang the opening bell in New York Wednesday.They are Ion Laser Technology Inc., a Salt Lake manufacturer of low-power, air-cooled lasers for research and industrial use, and Digitran Systems Inc., Logan, which builds simulator training systems for the petroleum industry and for crane operations.

Breeden said the new market was part of a growing effort to help small businesses raise capital. "It's a reflection of the importance of small businesses to the U.S. economy," he told The Associated Press.

Called the Emerging Company Marketplace or ECM, it is one of several recent steps by markets, regulators and the government to make it easier for small companies to gain access to the equity and debt markets.

"Bankers look at you like you have the plague because you're a small company," said Don Gallent, president and chief executive of Digitran Systems. "Everything in the marketplace is tailored to big companies."

Digitran, founded in 1979 and publicly owned since 1985, projects sales of $6.5 million in 1992, compared with $1 million five years ago.

The SEC last week proposed rules simplifying the process for small businesses to register securities. Breeden said the SEC also was devising simpler financial reporting forms for small companies to help them reduce costs.

Nearly all the companies that began trading Wednesday on the Amex were lured from the National Association of Securities Dealers' over-the-counter market.

The main attraction is exposure. Trading on the auction-style Amex floor affords attention from a single "specialist" who controls trading flow and can help develop volume in specific stocks. Stock prices on an exchange are set by supply and demand, rather than by dealer offers as on the over-the-counter market.

Some executives said their small companies languished on the electronic NASDAQ market among hundreds of similar small stocks and often were ignored by analysts, traders and investors.

The recent credit crunch badly hurt small companies seeking bank lending or venture capital. As the economy recovers, companies will need funds to increase inventory, replace equipment or expand markets. That's where executives hope the Amex market will help.

The new Amex market hopes to have 50 companies by the end of the year.

Another worry for the new market is that small company stocks with few shareholders (a minimum of 300) and small capitalization (minimum $1 million) face the threat of easy manipulation, risking investors' money.

But Amex chairman James R. Jones said the exchange's computerized surveillance would detect fraud. Breeden conceded the risk of manipulation but said the SEC was ready to intervene.

The Associated Press contributed to this article.