UDC's planned sale to China's HNA for $660 million fell through after the deal failed to achieve Overseas Investment Office approval.
The OIO said in December that it had rejected HNA's application to buy UDC due to unanswered questions about the Hainan-based conglomerate's ownership structure.
NZX-listed finance company Heartland has in the past expressed an interest in buying UDC but analysts have questioned whether its balance sheet is big enough to take on the company.
Devon Funds Management's managing director Slade Robertson said the market would be supportive of a quality business coming to the NZX.
"The operating environment for UDC has improved, with more conservative lending practices by the banks," Robertson said.
Harbour Asset Management Andrew Bascand said the market would "absolutely" welcome a new issue.
"We would have to be very careful to make sure than ANZ did not cherry-pick the best bits and pieces of UDC before it split it off, so there would be a lot of due diligence issues for that sort of IPO," he said.
"I would want to know if ANZ is serious about this, or whether this is just a foil for a trade sale," he said.
Massey University banking expert David Tripe said UDC would provide an opportunity for something like Heartland to take a cornerstone stake.
"Heartland has expressed an interest, but I think it's been a bit big for them," Tripe said. "But they might take a small position and expand it later on," he said.
The issue for a separated UDC would be how it funds itself without ANZ - New Zealand's biggest bank - standing behind it, he said.
"It would not have a great credit rating but it would not be as bad as if it had become part of HNA," Tripe said.
"I think it's a nice thought, but I think it might have some challenges in terms of getting the thing to run," he said.
UDC has a 75-year track record in New Zealand. It's been an important backer for the transport and earth-moving industry and has enjoyed a solid reputation.
Heartland, which has a market capitalisation of just over $1 billion, first raised the possibility of buying UDC from ANZ in 2016.
UDC, whose loan book is worth over $3 billion, reported a 5 per cent increase in its net profit to $61.6 million for the September year - a record.
At $1.039 billion, debenture funding remains an important part of the funding mix but has declined by 35 per cent from the prior year, the bank said in December.
ANZ last year increased the level of funding support with the limit on the facility increased to $2.7 billion, effective from last November.
Law firm Chapman Tripp said last month that competition for assets from private equity firms made 2017 a very quiet year for IPOs -- the worst since 2013 - despite the sharemarket rallying by more than 20 per cent.
The current year is expected to be similarly quiet before IPO activity picks up again in 2019, the firm said in a report released last month.
