Following the outbreak of COVID-19, NZX introduced a number of relief measures to assist issuers to raise capital urgently.
In light of the recent experience and global market trends, NZX has announced that it is undertaking a targeted review on capital raising settings and is seeking feedback on its proposals through a public consultation.
The proposed amendments NZX is seeking feedback on include:
- introducing downside price protection for retail investors where there are different components of an offer (e.g. for accelerated offers or placements and SPPs);
- allowing ANREOs as a permitted pro rata offer with a 1:1: offer limit;
- requiring a “liquidity event” in the form of either or both a shortfall bookbuild or rights quotation for a renounceable offer;
- requiring that the allocation policy for any shortfall from a pro rata offer must be first offered to all shareholders who participated in the offer and applied for more than their entitlement;
- increasing the SPP participation cap from $15,000 to $50,000 and the total cap from 5% to 10% of shares issued at the time of offer;
- allowing issuers to seek ratification of issues made under earlier SPPs; and
- requiring increased disclosure on underwriting (and sub-underwriting) arrangements including underwiring and sub-underwriting fees.
NZX is also seeking preliminary feedback on whether to:
- enable additional listing pathways that are used in offshore market such as Special Purpose Acquisition Companies (SPACs); and
- introduce a specific regime for dual class issuers.
The closing date for submissions is Friday 2 September 2022 and the full consultation paper is found here.
It you have any questions relating to consultation or would like to know how it may affect your business, please contact one of our experts.
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