A two-year push by Australia's stock exchange to entice Kiwi companies to list across the ditch is paying off and the trend is likely to accelerate following a reduction in compliance costs.
ASX listing rule amendments allow Kiwi companies listed on the NZX main board to be recognised as foreign exempt entities, which means they save costs by not having to submit a prospectus.
The ASX campaign was spurred by the New Zealand Government's partial sell-down of MightyRiverPower in 2013, sparking a slew of initial public offers on the local stock exchange, at a time when the Australian market had not yet kicked off. Since 2013 the number of Kiwi companies listed on the ASX through a primary or dual listing has increased to 41 from 19. Another five to 10 are in the pipeline in the next year, said Max Cunningham, ASX general manager of listings and issuer services.
Typically New Zealand companies list on the ASX to gain access to a deeper pool of capital, Mr Cunningham said. The market value of securities on the ASX is A$1.5 trillion compared to the NZX's $100.6 billion.
An Orient Capital study ASX commissioned last year claimed an Australian listing enabled New Zealand companies to access an investment pool of A$241 billion, five times the funds available to a solely NZX-listed company.
