AKC
09/03/2015 14:10
WAV/RULE
NOT PRICE SENSITIVE
REL: 1410 HRS Auckland Council
WAV/RULE: AKC: AKC - Waiver from NZX Debt Market Listing Rule 5.2.3
NZX Regulation Decision
Auckland Council (AKC)
Application for a waiver from NZX Debt Market Listing Rule 5.2.3
27 February 2015
Waiver from NZX Debt Market Listing Rule 5.2.3
Decision
1. Subject to the conditions in paragraph 2 below, and on the basis that the
information provided by AKC is complete and accurate in all material
respects, NZX Regulation ("NZXR") grants AKC a waiver from NZX Debt Market
Listing Rule ("Rule") 5.2.3 in respect of the Bonds for a period of 12 months
from the Quotation date for the Bonds, to allow AKC to have fewer than 500
Bondholders who are Members of the Public holding at least 25% of the Bonds.
2. The waiver in paragraph 1 above is provided on the following conditions:
a. AKC clearly and prominently discloses this waiver and its effect in the
Series Notice for the Bonds;
b. AKC clearly and prominently discloses this waiver and its effect in its
half-year report, and its annual report for the year the waiver is relied on;
c. AKC discloses liquidity as a risk in the Series Notice for the Bonds; and
d. AKC notifies NZXR as soon as practicable if there are any material changes
to the total number of Members of the Public holding Bonds, and/or the
percentage of total Bonds held by Members of the Public holding at least a
Minimum Holding.
3. The material information on which this decision is based is set out in
Appendix One to this decision. This waiver will not apply if that information
is not, or ceases to be, full and accurate in all material respects.
4. Rule 5.2.3 to which this decision relates is set out in Appendix Two.
Reasons
5. In coming to the decision to grant the waiver set out in paragraph 1
above, NZXR has considered that:
a. Debt Securities are not typically subject to the same degree of trading
activity as Equity Securities;
b. AKC has advised that it expects the spread of the Bonds will increase to
meet the spread requirements of Rule 5.2.3 over time;
c. the 12-month waiver gives NZXR the opportunity to reconsider the spread of
the Bonds in 12 months' time if AKC considers a waiver is still required;
d. the conditions, contained at paragraph 2(a), (b) and (c) above, will
ensure that prospective Bondholders, as well as those wishing to trade in the
Bonds, are aware that the Bonds may not satisfy the spread requirements of
Rule 5.2.3; and
e. there is precedent for this decision.
Confidentiality
6. AKC has requested that the application for a waiver from Rule 5.2.3, and
NZXR's decision, be kept confidential until the Series Notice, and the form
of notice to be provided by AKC under clause 20(1)(a) of schedule 8 of the
Financial Markets Conduct Regulation 2014, has been released.
7. In accordance with Footnote 1 to Rule 1.11.2, NZXR grants AKC's request.
Appendix One
1. Auckland Council ("AKC") is a Listed Issuer with securities Quoted on the
NZX Debt Market ("NZDX"). These Securities include the AKC020 Bonds, AKC040
Bonds, AKC050 Bonds, AKC060 Bonds and AKC070 Bonds.
2. AKC intends to make a new offer of fixed-rate bonds ("Bonds") to be Quoted
on the NZDX (the "Offer").
3. AKC considers that it is unlikely that the Bonds will meet the spread
requirements of Rule 5.2.3 when the Bonds are Quoted on the NZDX. However,
AKC anticipates that there will be strong investor demand for the Bonds,
leading to an increase in the spread of the Bonds over time.
Appendix Two
Rule 5.2.3
A Class of Securities will generally not be considered for Quotation on the
NZSX or NZDX unless those Securities are held by at least 500 Members of the
Public holding at least 25% of the number of Securities of that Class issued,
with each Member of the Public holding at least a Minimum Holding, and those
requirements are maintained, or NZX is otherwise satisfied that the Issuer
will maintain a spread of Security holders which is sufficient to ensure that
there is a sufficiently liquid market in the Class of Securities.
End CA:00261600 For:AKC Type:WAV/RULE Time:2015-03-09 14:10:58
