Corporate Finance Update - Issue 23

Issue 23, July 2025

ASIC clears path for faster IPOs

Entities listing on the ASX via the fast-track process will now have access to a shorter initial public offering (IPO) timetable, as part of a two-year trial designed to reduce deal execution risk.

ASX Fast-Track is available to entities that will have a market capitalisation of at least $100 million upon listing and no ASX imposed escrow (eligible entities/eligible companies). Eligible entities can provide a pathfinder prospectus or pathfinder product disclosure statement (PDS) to ASIC on a confidential basis, at least 14 days period before formal lodgement. This document should be in near final form.

ASIC will endeavour to complete its review in the 14-day period before lodgement and will generally not need to extend the seven-day exposure period to 14 days after lodgement unless material new information becomes available. This could reduce the IPO timetable by up to a week. ASIC will retain its ability to use stop orders up until listing.

ASIC has also announced a no-action position that allows eligible companies to accept investor applications during the public exposure period for new listings. This aligns the process for prospectuses with PDSs, simplifying the administrative process by removing the need to wait for the exposure period to lapse.

ASIC’s no-action position applies only to the offers of non-quoted securities under a disclosure document issued by an eligible company in accordance with Chapter 6D of the Corporations Act 2001 made during the trial period. ASIC’s general policy on ‘no-action’ positions also applies, as outlined in Regulatory Guide 108 No-action letters (RG 108).

For further information, including the conditions of the trial and ASIC’s general policy on ‘no-action’ positions, read the media release.

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Proposal to remake disclosure relief for offers of foreign securities and interests to Australian investors

ASIC is seeking feedback on its proposal to remake six sunsetting legislative instruments which provide disclosure relief.

The relief enables Australian investors to participate in offers that might not otherwise be extended to them. This is due to the time and expense involved in complying with the regulatory requirements in multiple jurisdictions where:

• a foreign offeror has complied with a disclosure regime offering similar levels of investor protection to the Australian disclosure requirements, or
• very few offers are made to Australian investors.

The remade legislative instruments also provide relief from the advertising restrictions for advertisements and other notices that are aimed at foreign markets and only incidentally published in Australia.

ASIC proposes to remake the legislative instruments on largely the same terms, for a period of five years. Some of the key changes include:

• a consolidated exemption for authors or publishers in draft instrument ASIC Corporations (Foreign Securities—Incidental Advertising) Instrument 2025/XX
• rewording the declaration in draft instrument ASIC Corporations (Foreign Small Scale Offers) Instrument 2025/XX to remove ambiguity about when it applies and who it applies to, and
• removing definitions which are now contained in the Corporations Act 2001.

These changes are intended to improve clarity, not change the operation of the relief.

The proposed legislative instruments to be remade are:

• ASIC Corporations (Compromises or Arrangements) Instrument 2015/358
• ASIC Corporations (Foreign Rights Issues) Instrument 2015/356
• ASIC Corporations (Foreign Scrip Bids) Instrument 2015/357
• ASIC Corporations (Foreign Securities—Incidental Advertising) Instrument 2015/360
• ASIC Corporations (Foreign Securities—Publishing Notices) Instrument 2015/359, and
• ASIC Corporations (Foreign Small-Scale Offers) Instrument 2015/362.

Providing feedback

ASIC invites feedback on its proposal to remake the legislative instruments, which are due to sunset on 1 October 2025.

Feedback should be sent to rri.consultation@asic.gov.au by 5pm AEST on 15 August 2025.

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Industry feedback from public and private markets discussion paper released

ASIC has published more than 60 non-confidential submissions (from almost 90 submissions received) in response to its discussion paper on the evolving dynamics between public and private markets, released in February 2025.

The responses have been overwhelmingly positive and reflect the views of industry bodies, market operators, superannuation trustees, fund managers and other stakeholders across the finance sector.   

ASIC has distilled the feedback into the following themes:

• Structural and cyclical factors are shaping both public and private markets
• Public market adjustments would improve and enhance their attractiveness
• Private markets are here to stay and grow, there is an acknowledgement of the need for any regulatory guidance to be measured, working closely with industry and aligning to international standards
• Private credit is good for the economy and investors, if done well. There may be work to do to ensure it is sustainably done well
• Superannuation is a mature investment force in Australia and a significant and structural influence in markets and investment
• More to do on data collection and transparency of private markets including in dimensioning the market itself and learning from international practices.

ASIC will continue to engage with industry to progress consideration of these proposals with a view to publish a report later this year setting out our response to the public markets proposals.

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Tribunal affirms ASIC’s crowd-sourced funding stop order decision on use of nominee structure

The Administrative Review Tribunal (ART) has affirmed ASIC’s decision to issue a stop order on a crowd-sourced funding (CSF) offer by Hirehood Pty Ltd, that required investors to hold shares through a nominee structure.

The ART accepted ASIC’s view that CSF offers made in respect of fully paid ordinary shares must result in the acquisition of full legal and beneficial rights in those shares. The Corporations Act 2001 allows investors to elect to use custodial or nominee arrangements to acquire shares in a CSF offer. However, the ART found that because investors were only able to receive a beneficial interest held through a nominee, not the full legal and beneficial rights to the shares, the offer did not comply with the CSF regime.

This decision reinforces ASIC’s position that it will take action where CSF offers do not meet the legislative requirements.

• Read the media release.

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Disclosure of non-IFRS financial information in fundraising documents

Fundraising disclosure documents commonly reference financial information that is not presented in accordance with all relevant accounting standards (non-IFRS financial information). These metrics, and associated ratios, can provide meaningful insight into the issuer’s financial position, performance and valuation.

‘Non-IFRS profit information’ is calculated on a basis that is not in accordance with International Financial Reporting Standards (IFRS), or in accordance with IFRS but adjusted in some manner. ‘Pro forma financial information’ is non-IFRS financial information that is intended to show the effects of a proposed or completed transaction, such as a fundraising, for illustrative purposes.

We commonly observe ‘pro-forma’, ‘underlying’ and/or ‘adjusted’ earnings disclosures, and related valuation ratios, noted prominently in disclosure documents. For example, these may include ‘enterprise value/underlying earnings before interest and taxes (EBIT)’, or ‘market capitalisation/adjusted net profit after tax (NPAT)’. These terms can have different meanings in different documents.

While we do not seek to prohibit the use of appropriate non-IFRS financial information, we remind issuers that they must clearly explain and define each selected metric and related ratio. Further, where these metrics and ratios are given prominence (e.g. early in a prospectus offer summary), they should each be clearly defined and explained in full at that page or section of the document.

For more information, see:

• Regulatory Guide 230 Disclosing non-IFRS financial information (RG 230)
• Regulatory Guide 228: Prospectuses: Effective disclosure for retail investors (RG 228).

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Share buy-backs with significant effects on control

In the last Corporate Finance Update, we indicated our intention to scrutinise buy-backs with significant control effects.

ASIC recently intervened in a proposed buy-back in which the company’s CEO and CFO decided not to participate. If all other shareholders participated in the buyback, it would increase the voting power of the CFO from 11.8% to 29.8%, and the CEO from 27.8% to 70.2%.

We held concerns about both disclosure and fairness when considering the principles of Chapter 6 and relevant Takeovers Panel decisions. In particular:

• the notice of meeting included inconsistent and ambiguous statements about the value of the company. It suggested the share price undervalued the company, without an explanation, but also relied on the share price to suggest the buyback was at a premium
• the valuation did not appear to have a reasonable basis, and despite the significant control implications, no independent expert’s report had been commissioned
• the CEO intended to vote for the buy-back resolution, raising fairness concerns as to whether the CEO should be permitted to vote where the buy-back would substantially increase their voting power.

The company considered ASIC’s position in good faith and agreed to defer the meeting to:

• obtain an independent expert’s report
• provide enhanced disclosure in the notice of meeting, and
• impose a voting restriction on the CEO, who also abstained from making a recommendation.

ASIC was prepared to seek remedial orders in the Takeovers Panel to the same effect.

Subsequently, the company also increased the price of the buy-back.

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Independent experts in section 444GA transactions

ASIC reminds external administrators and advisors that an independent expert report (IER) provided to shareholders in connection with a share transfer under section 444GA of the Corporations Act 2001 (the Corporations Act) should generally be authored by an expert who holds an Australian financial services (AFS) licence.  

Section 444GA of the Corporations Act allows shares of a company in administration to be transferred by an administrator as part of a deed of company arrangement (DOCA) where the administrator has written consent from the owner of the shares, or the leave of the Court. Where a transfer under section 444GA will result in a person acquiring a relevant interest in voting shares in a company subject to Chapter 6 above 20%, relief from section 606 of the Corporations Act must be applied for and granted by ASIC.

Among other requirements, ASIC will generally only grant relief where an IER that is prepared consistent with guidance in Regulatory Guide 111: Content of expert reports (RG 111) is provided to shareholders. An IER is provided for these transactions to assist retail shareholders to decide whether to oppose the application for leave of the court and to understand why their shares are being expropriated without any consideration.

As outlined at RG 111.138, IERs typically constitute giving financial product advice, so an expert must hold an AFS licence. Although section 911A(2)(f) of the Corporations Act contains an exemption from the requirement to hold an AFS licence for persons performing functions or exercising powers in their capacity as external administrators, the expert is not acting in this capacity and so must generally hold an AFS licence.

ASIC may decline to provide relief if the IER is not authored by an expert with an appropriate AFS licence.

For more information, see:

• Regulatory Guide 6 Takeovers: Exceptions to the general prohibition (RG 6) at RG 6.195–RG 6.202, and
• RG 111 at RG 111.34–RG 111.139.

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Inside ASIC: Series 2 podcast launches

The second series of ASIC’s podcast, Inside ASIC, has been released and highlights our work across a number of priority areas. In the latest episode, we look at ASIC’s work to combat scams.

Previous episodes have examined why ASIC is holding super funds to account, some of the big issues with insurance after recent devastating natural disasters in Australia, cracking down on greenwashing, and why we might just be witnessing a fundamental change in Australia’s financial markets with the rise of private markets.

Listen to Inside ASIC on Spotify, Apple Podcasts, or wherever you listen to podcasts.

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