Trans-Tasman listings on the rise

by Hannah Norton25 Mar 2015
Two more New Zealand companies look set to take the plunge into the Australian stock market, with dual listing on the NZX and ASX.
 
Auckland-based crime-fighting software and services business Wynyard Group last week announced it was commencing the dual listing process following board approval.
 
The announcement coincided with Auckland-based business, the a2 Milk Company Limited, being advised that its application for listing on the ASX has been approved in principle, subject to customary pre-quotation conditions.
 
Speaking to NZLawyer, Wynyard Group chief executive Craig Richardson said seeking an ASX listing was a logical strategic move for the company for three main reasons.
 
“The first one is, because we are a global business, there are a number of international and foreign funds that have expressed an interest in buying stock, and they don’t have a mandate to trade in New Zealand.
 
“Listing on ASX will enable more Australian and foreign investors to hold Wynyard stock, participate in the company's growth and increase the attractiveness of Wynyard shares.
 
“The second one is there is a healthy superannuation fund market in Australia and so if we wanted to raise more capital it would give us wider access to a bigger funding pool. And we’ve certainly proved popular in Australia – there’s a lot of interest in what we are doing.
 
“Thirdly, just increasing our profile in Australia is helpful. Asia Pacific is probably our home market, so you can’t ignore the size of Australia, and the problems that they’ve got that we help fix.”
 
Wynyard Group has appointed UBS New Zealand to advise on the proposed ASX listing, with Buddle Findlay partner Sacha Judd as lead legal advisor. It is expected the process will be complete during the third quarter of this year. The company intends to maintain its New Zealand incorporation and its principal listing on the NZX Main Board, which it first listed on in July 2013.
 
Further announcements will be made in coming months.
 
Meanwhile, Auckland-based a2 Milk Company Limited (a2MC) was last week advised that its application for listing on the ASX has received preliminary approval.
 
The company’s product is milk from cows that contains only the A2 type of beta-casein, hailed as a better form of milk for those with digestive issues.
 
The company is being advised by Goldman Sachs and DLA Piper for its Australian debut, the date for which is yet to be set by the ASX.
 
The company’s goal of listing is to boost the liquidity of its shares, but there are no plans to raise new capital in a float on the ASX. It will maintain its New Zealand incorporation and NZX listing. The company first listed on the NZAX market in April 2004 before completing capital raising and transferring the listing the NZX Main Board in 2012.
 
Minter Ellison Rudd Watts corporate partner Silvana Schenone told NZLawyer the appeal for New Zealand companies wanting to list on the ASX included a variety of factors, such as access to greater liquidity, and more visibility and credibility.
 
She believed the number of dual listings on the NZX and ASX was trending upwards.
 
“I think so, and I think they are becoming more attractive, because there is only so much capital available in New Zealand. Everyone’s quite keen on getting those good shareholders, good institutions from Australia too.”
 
The ASX has just released a consultation paper which proposes to remove the additional ASX compliance costs for NZ companies that are dual-listed, she said.
Minter Ellison Rudd Watts, together with their Australian counterparts, will be making submissions in favour of the proposed changes.

For more on comment on dual listings, as well as information about the consultation paper released by ASX with regards to dual listings, see Friday’s newsletter.
 
 

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