One of the country's top fund managers has criticised the Australian Securities Exchange's process for reviewing trading halts after car leasing financier McMillan Shakespeare's shares slumped when a trading freeze was rejected.
Shares in the salary packaging company were suspended two weeks ago after the federal government announced changes to the fringe benefits tax regime. The federal government said the tax changes would help to pay for the revenue shortfall left by scrapping the carbon tax.
McMillan Shakespeare last week asked the ASX if it could remain in a trading halt until after the election. But the ASX rejected the request, saying interruptions to the market should be kept to a minimum.
"In the case of McMillan Shakespeare, the market is as informed as it can be ... which is not the same as there being no residual or ongoing uncertainty," ASX spokesman Matthew Gibbs said.
When shares in McMillan resumed trading on Thursday they fell as much as 50 per cent.
John Abernethy, from Clime Investment, which has $12 million invested in McMillan, has attacked the ASX's decision.
"The ASX took all of one hour to say 'nup, you're going to be listed'," he said. "That decision by the ASX to let the shares trade without due process, consideration and inquiry, going to the Australian Securities and Investments Commission to see what their view was, asking practitioners in the market what their view was ... I could see no reason why they had to list immediately. What was the cost to the ASX to grant some more time for more information to flow?"
But the ASX said McMillan disclosed to the market all material information of which it was "aware", so no proper basis remained to keep its securities suspended. "The purpose of trading halts and voluntary suspensions is as 'mechanisms that listed entities can use to manage their continuous disclosure obligations'," an ASX spokesman said.