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Public markets play a critical role in Australia's economy by helping companies grow and giving investors the opportunity to share in that growth. ASX's Listing Rules underpin a key part of this eco-system by providing a fair, orderly and transparent regime for investors and listed entities. ASX's rules and guidance promote a listing environment where both investors and listed companies can have confidence about how we will apply the rules and ASX regularly consults with the market to ensure the Listing Rules remain effective and fit for purpose.
Recently, there has been heightened investor interest in shareholder approval requirements for mergers and takeovers of listed companies undertaking a significant transaction. This issue has been elevated following the application for a waiver to the requirement for a shareholder vote by building products provider James Hardie in relation to its proposed acquisition of US-based Azek. The waiver application by James Hardie under Listing Rule 7.2 was granted by ASX and a detailed rationale for that decision was provided on 16 April 2025 and is attached to this release.
The Listing Rules need to balance the interests of both listed entities and investors, and ASX has a strong interest in ensuring the rights and interests of both groups are appropriately represented. However, ASX acknowledges that Australian institutional investors are concerned that the current settings for shareholder approval requirements may not provide them with enough of a voice.
To address this question, ASX will commence work to update an analysis from 2017 which looked at shareholder approval levels needed for listed company mergers, which had a particular focus on reverse takeovers. This will be the first step in conducting a review of shareholder approval requirements as covered by the relevant Listing Rules. At the same time as updating this analysis, ASX will also explore the circumstances in which companies are required to disclose receipt of a waiver to the Listing Rules when they publicly announce the matter to which the waiver relates.
Helen Lofthouse, ASX Managing Director and Chief Executive Officer, said: "We have heard from investors — many of them shareholders of James Hardie - that they want a greater voice for shareholders invested in ASXlisted companies, but we are also mindful that we need to examine this question in a way that ensures we serve the needs of the market as a whole.
"We will seek feedback from stakeholders once we have updated the 2017 analysis and this will support a more informed review of shareholder approval requirements."
