ASX’s Investigations and Enforcement Unit (“I&E”) has conducted a review of Goldman Sachs JBWere Pty Ltd’s (“GSJBW”) role as a Joint Lead Manager (“JLM”) in the book build allocation of the quoted securities of Just Group Limited (“JST”) prior to the commencement of trading in JST on ASX on 7 May 2004 (“the review”). I&E conducted the review in cooperation with GSJBW as a result of its concerns about GSJBW’s role in the book build. Specifically, ASX had concerns that certain recipients received a fee of 15 cents from GSJBW for taking up the JST shares while others did not. By issuing the Management Letter below, ASX does not assert that GSJBW breached the Operating Rules or the Corporations Act and acknowledges that GSJBW asserts that it acted in the best interests of the JST shareholders, JST and the market. ASX accepts that GSJBW acted honestly and did not act with any improper or ulterior motive.
However, ASX considers it appropriate in the circumstances to issue this Management Letter to the public and the investment and stockbroking community, with a view to promoting an understanding of the matters which have given rise to concerns in this matter, to assist in the future conduct of book builds. ASX has the option of issuing a Management Letter where it considers it appropriate to notify the public of identified market concerns and to obtain appropriate regulatory effect where disciplinary action before the Disciplinary Tribunal is not warranted.
ASX notes that there is currently no clear guidance in relation to the book build process. ASX, in consultation with GSJBW and other Market Participants, will produce a Guidance Note, addressing future best practices with respect to the book build process.
Click here to download the "Release of Public Management Letter".
