UPDATED: The Australian Securities and Investments Commission (ASIC) is about to test a new process for companies listing their shares on the Australian Securities Exchange (ASX) amid a dearth of initial public offerings (IPOs).
The corporate regulator said the two-year trial of ‘fast track’ initiatives beginning today could cut the IPO timetable by up to a week.
ASIC said that under the trial it would informally review offer documents two weeks before public lodgement.
This would reduce the need for supplementary and replacement documents, exposure period extensions and the risk that market volatility and pricing changes may impact investor interest.
The changes include a ‘no action’ position by ASIC that allows eligible companies to accept retail investor applications during the public exposure period for new listings, cutting down the administrative timeline of the IPO process.
“Creating a more streamlined IPO process underscores our commitment to ensuring our public markets remain attractive to companies and investors,” ASIC Chair Joe Longo said in a media release.
“Greater deal certainty for companies should help deliver more IPOs, which means more investment opportunities so companies can expand, increase jobs and ultimately economic growth.
‘Our initial public offerings are the lowest they have been in over a decade, and companies are de-listing.
Meanwhile, our secondary capital raising settings continue to be globally recognised for their speed and efficiency.”
Funds raised through IPOs fell to A$4.2 billion (US$2.74 billion) last year from $22.9 billion in 2014.
The drivers of this plunge in listings include takeovers of listed companies and a preference to raise capital while remaining in private ownership.
A notable exception is airline Virgin Australia’s A$685 million IPO that was launched last week.
The changes are in response to pressure on ASIC and the ASX to speed up the IPO vetting process and were proposed by a group of investment banks led by JPMorgan.
They apply to companies seeking to list on ASX which have an expected market capitalisation of more than $100 million and no ASX-imposed escrow.
On 26 February 2025, ASIC released a discussion paper which explored changing capital markets dynamics including falling public market listings.
