In a statement on Tuesday, ASIC said companies listing on the ASX via the fast-track process – those with a market capitalisation of at least $100 million and no ASX-imposed escrow – will now benefit from a shorter initial public offering (IPO) timeline designed to reduce deal execution risk.
Under the program, ASIC will informally review eligible offer documents two weeks before public lodgement, reducing the need for supplementary disclosures and minimising the risk that market volatility or shifting valuations could dampen investor interest.
The initiative is part of ASIC’s response to the ongoing decline in IPO activity and the shrinking pool of public companies, concerns it raised in a discussion paper released in February. The trial also includes a “no-action” position that allows eligible issuers to accept retail investor applications during the exposure period, further compressing the administrative timeline for IPOs.
“Greater deal certainty for companies should help deliver more IPOs, which means more investment opportunities so companies can expand, increase jobs and ultimately, economic growth,” ASIC chair Joe Longo said.
“Our initial public offerings are the lowest they have been in over a decade, and companies are delisting. Meanwhile, our secondary capital raising settings continue to be globally recognised for their speed and efficiency.”
A report commissioned by ASIC and prepared by University of Melbourne researcher Dr Carole Comerton-Forde found that between December 2022 and December 2024, the number of domestic and foreign equity issuers on the ASX fell by 145 to 1,989, with a combined market capitalisation of $3 trillion.
The drop reflected just 66 new listings over the period, compared with 211 delistings. While not unprecedented, Comerton-Forde noted that the high ratio of exits to entries had only been seen before in the early 1990s.
“We can’t be complacent about the future of Australia’s public equity markets,” Longo said at the time.
Reiterating the message on Tuesday, Longo said that after calling for solutions earlier this year, the regulator is “proud” of how quickly it has worked with industry to act on those ideas.
“While we do not see regulatory settings as the silver bullet, we have received lots of ideas and are considering further regulatory adjustments to support a strong and well-functioning market,” Longo said.
He added that ASIC will monitor the effectiveness of both the review trial and the no-action relief and may modify or withdraw them at any time.
Comerton-Forde’s report also pointed to a broader erosion in Australia’s global capital markets standing. ASX market capitalisation as a share of global market cap fell from 2.1 per cent in 2013 to 1.6 per cent in 2023, while its market capitalisation relative to gross domestic product declined from a peak of 140 per cent in 2006 to 103 per cent in 2023.
While the trend mirrors developments in other countries, the report emphasised the unique influence of Australia’s superannuation sector, which is playing an increasingly prominent role in private markets. The largest super funds now allocate nearly a quarter of their assets to private investments, with plans to increase that share.
Comerton-Forde also flagged high market concentration as a concern, noting that as of December 2024, the 10 largest companies on the ASX made up around 40 per cent of total market capitalisation.
Ultimately, in concluding her research, the researcher said she did not find evidence to support the claims that the Australian public market is in structural decline.
“However, there is reason to carefully watch the developments in both the private and public markets and to dig further into the reasons for the recent trends that have been observed in Australia,” she said.
The researcher pointed to data suggesting that the regulatory burden and explicit costs of being public in Australia are much lower than for public companies in the US, adding that it is therefore “not likely” to be the primary driver of companies staying private.
Instead, she highlighted the trade-offs that companies face in deciding to go public appear to have altered as private capital has become more readily available.
