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Ann: Demerger of European Businesses, page-229

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skinsy11

2,642 Posts.

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03/09/21

21:17

Post #: 55824418
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Originally posted by JoeGambler: ↑

I'm no corporate lawyer, but if ISX is using a transaction specific prospectus, and a demerger certainly sounds like a transaction, ISX may have some trouble getting approval from ASIC.

Rationale for transaction-specific prospectuses

Transaction-specific disclosure is possible only within a regime of continuous disclosure. When an issuer issues continuously quoted securities, or options to acquire continuously quoted securities, the market should generally have the information necessary to reach an informed view about the relevant continuously quoted securities.
...
The Explanatory Memorandum to the Financial Services Reform Bill 2001 notes that it is possible—depending on an individual market’s listing rules—that continuous disclosure may apply when securities are suspended: para 18.6. Where this is the case, companies that have had continuously quoted securities suspended may still use transaction-specific disclosure subject to the considerations set out in this guide.
...
ASIC’s exclusion powers—s713(6)

ASIC has the power to exclude an issuer from using a s713 prospectus (see s713(6)) and this is done by an instrument in the form of Pro Forma 162 ASIC excluding reliance on s713(6) (PF 162). When such an instrument is in force, the issuer cannot use a transaction-specific prospectus during the period specified in the notice.

Under s713(6), we may exercise ASIC’s power to exclude an issuer from s713 whenever we become aware that, in the previous 12 months, the issuer has not complied with any or all of its disclosure obligations to:
(a) prepare audited financial reports (Ch 2M);
(b) correct a defective issuer’s cleansing notice (s708A(9) and 708AA(10));
(c) provide continuous disclosure (s674 and 675);
(d) ensure there are no false or misleading statements (see s1308) in an issuer’s ‘cleansing notice’ required by s708A(5) or 708AA(2);
(e) ensure it does not prepare defective disclosure documents (s724); and
(f) ensure there are no misstatements in, or omissions from, a disclosure document (s728).

For instance, we might use ASIC’s exclusion powers to prevent an issuer from using the transaction-specific prospectus regime if the entity’s continuously quoted securities are suspended from quotation or are the subject of a trading halt and we have concerns that the entity has not complied with its continuous disclosure obligations.

We may use ASIC’s exclusion powers after raising concerns with or taking other action against an issuer. However, we do not have to take other action to use ASIC’s exclusion powers.

https://asic.gov.au/media/uyrlkchj/rg254-published-27-august-2020-20210426.pdf

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Maybe this is to 'wedge' ASIC. Against the background of the information shown in the SOC, could the actions of ASIC to block the demerger prospectus dig a bigger hole for ASIC and show it is being capricious? This might be opening up a new front in the war of attritian. In view of the matters set out in the SOC (latest version), this would send this to the ASIC board for its decision. After all, ASIC officers provided 'tacit' consent to the suspension of ISX.
There ae also other possibilities, but to air them in a public forum might be seen as defamatory.
All just my 'musing' as to the permutations and motives.

Last edited by skinsy11: 03/09/21

ISX Price at posting: $1.07 Sentiment: None Disclosure: Held
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