Australian regulator probes bankers behind Firmus IPO marketing

what happened

Australia's corporate regulator, ASIC, is examining how bankers promoted the IPO of Firmus, a data centre operator backed by Nvidia, The Australian reported, citing a letter from ASIC chair Sarah Court to Liberal Senator Dave Sharma. She said the regulator is making targeted inquiries of the joint lead managers.

Firmus shelved its $5 billion IPO on October 9 and said it would pursue other fundraising options, including capital from private markets. Bank of America, JPMorgan, Morgan Stanley and the Australian broker Morgans led the book-building. Bank of America declined to comment, while the other two US banks and Morgans did not immediately respond.

Court wrote that the regulator is aware of questions about the accuracy of information given to institutional and wholesale investors during marketing and book-building. The A$11-per-share price came under pressure as investors worried about the company's debt and its limited track record in building AI data centres.

why it matters

For markets, the probe signals that large technology listings may face tighter scrutiny of how banks market deals to investors. It also matters for anyone tracking AI infrastructure listings in Australia, given the shelved offering and the possible consequences for the lead managers.

market impact

Banks leading the Firmus IPO: a regulatory probe could weigh on their reputation in deal marketing

• ▼Bank of America pressure down — a possible review of listing practices pressures the bank's reputation

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