More New Zealand companies plan full listing on ASX

2.00pm

New Zealand companies are scrambling to gain full listing on the Australian Stock Exchange following a rule change with one exception -- Contact Energy.

Fletcher Forests, Fletcher Building, Sky City casino, Waste Management, Nuplex, and Summit Resources have all announced this week that they seek full listing on the ASX.

The ASX said on Monday it had decided to make changes to its foreign exempt category, of which 23 New Zealand companies make up about half.

The new rules require a foreign exempt company to have either assets of $A2 billion ($NZ2.4 billion) or operating profit of $A200 million for each of the last three years to qualify for the cheaper listing.

Most companies said they would be fully listed by the time the changes take effect on July 1.

However, Contact Energy said today it would de-list from the ASX as a result of the rule change.

"Dual-listing on the New Zealand and Australian stock exchanges has, until now, been a relatively low-cost option for New Zealand-based companies," Contact chairman Phil Pryke said in a statement.

"However, with the forthcoming changes to the ASX Listing Rules, the board has reviewed the issue and concluded the cost of securing a full, separate listing on the ASX is not justified.

"Accordingly, we have informed the ASX today that it is our intention to de-list."

Contact has fewer than 100 shareholders in Australia holding about 350,000 shares, or less than 1 per cent of the company.

The move has essentially upped the cost for New Zealand companies wishing to tap into the Australian market.

The foreign exempt status meant lower compliance costs and cheaper listing fees. The cost of a full listing would depend on the size of the company.

Despite some annoyance in New Zealand at the change, the ASX said the new rules would strengthen the exchange's international reputation and were not intended to damage trans-Tasman relations.

Several companies, such as forestry giant Carter Holt Harvey and the smaller Genesis Research, had previously flagged their intention to seek a full listing on the ASX because of the change in policy.

Foreign exempt entities are offshore-based companies which are not subject to most ASX listing rules, including continuous disclosure, and instead lodge all periodic reports and notices to their home stock exchange.

At present, foreign exempt companies can be listed on the ASX if they have net assets of $A50 million, or profit before tax in each of the previous three years of at least $A10 million.

New Zealand-based foreign exempt companies on the ASX include Telecom, Air NZ, Auckland International Airport, The Warehouse, and Tower.

Australian companies listed on the NZSE under a similar mutual recognition policy include Telstra, ANZ, and Foodland.

- NZPA