Did the investment banks and stockbrokers working on Firmus’ initial public offering have a reasonable basis for the representations they made about investor demand?
That’s essentially what the corporate regulator’s inquiries into the abandoned ASX listing of neocloud Firmus will centre on, as it assesses whether there was any wrongdoing or deceptive behaviour, and whether to launch a formal investigation.
It should be clear-cut and the joint lead managers on the deal will have records to show where indications of interest were sitting at various points ahead of, and during, the bookbuild. That’s the process that was set up to deliver the company a market capitalisation of almost $44 billion if all went to plan.
But muddying the waters for ASIC and those involved is that there are varying reports about just how much indicative demand there was for Firmus’ shares, pitched to investors last month at $11 apiece.
That’s one key issue the Australian Securities and Investments Commission will need to decipher. The other is that ASIC chair Sarah Court and her team will need to assess whether the float’s lead managers adequately updated investors on material changes to demand during the process.
AFR
