If the ASX can survive this onslought it'll be truly impressive

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Australia’s top fund managers and superannuation funds have joined together in an unprecedented move to protest at the Australian Securities Exchange’s apparent decision to allow James Hardie to proceed with its US acquisition without seeking shareholder approval.

In a letter to the ASX chair David Clarke and chief executive Helen Lofthouse the group, which controls a large swag of Australian savings, has written to protest the move and lack of transparency from the ASX.

The letter noted the issues involved in the $14bn Hardie-Azek merger “create investment risk for shareholders invested in ASX listed companies generally, and we would encourage the ASX to have proper regard to the rights of longstanding investors in these important decisions.”

The attack comes soon after the ASX’s own governance standards were attacked by its regulators — the Australian Securities and Investments Commission and the Reserve Bank — over its appalling track record in technology, including trading breakdowns and mishaps in the CHESS settlement system replacement.

This time it’s the ASX regulation of the Australian listed market which is being questioned.

The letter is signed by a who’s who of Australian fund managers including Mark Delaney from Australian Super, Fidelity’s Paul Taylor, UniSuper’s John Pearce, Allan Gray’s Simon Mawhinney, Airlie’s Matt Williams, Troy Angus from Paradice, Andrew Fleming from Schroder and Ausbil’s Paul Xiradis.

The ASX has already granted a waiver to let the deal through but the battle now is over James Hardie’s wish to convert to a US listing as its primary domicile. The fund managers want a shareholder vote on this issue but the ASX may reject their demand and simply grant the request without seeking shareholder approval.