ASIC Probes Claims Made to Investors in Collapsed $44 Billion Firmus Float

In a letter to Liberal senator Dave Sharma, the chair of the Australian Securities and Investments Commission, Sarah Court, set out where the regulator stands on the collapsed float of data centre company Firmus. ASIC, she wrote, is making targeted inquiries of the joint lead managers of the offer, which would have valued the homegrown company at almost $44 billion. She added that no adverse inference should be drawn yet.

The letter, first reported by The Australian, describes what the inquiries are about. ASIC is aware of questions over whether information given to institutional and wholesale investors during the marketing and bookbuild was accurate, appropriately qualified and backed by a reasonable basis when it was provided. Court wrote that the inquiries are ongoing and that ASIC will consider what it obtains and whether any further consideration is warranted.

At a Senate estimates hearing on Thursday, Court stressed that the work is preliminary and that no formal investigation has been launched. She called the episode a very significant event that the regulator understands it must look at carefully.

She also pushed back on the idea that the withdrawal exposed a flaw in the system. In the letter, she said ASIC does not regard it as a failure of Australia's capital markets or of the rules governing pre-IPO marketing and institutional bookbuilds. Robust negotiation between issuers and informed institutional investors, she wrote, is an ordinary and important part of price discovery. Separately, ASIC has been reviewing its pre-lodgement advertising and publicity relief for offers of securities to retail investors that require a disclosure document.

The scale of the planned deal explains the attention. Bank of America, JPMorgan Chase, Morgan Stanley and Morgans Financial were joint lead managers, aiming to raise about US$5.5 billion ($7.9 billion). That would have been the largest ASX float since Telstra in 1997. The money would have let Firmus borrow many billions more to build data centres across Australia, Singapore, Malaysia and Indonesia, which the company forecast would sell services to customers such as Meta and OpenAI.

But some potential investors grew more cautious as the deal went on. They worried that existing shareholders could flood the market soon after the debut, and some saw the pricing as aggressive. Firmus's latest annual revenue was just $50 million, and it currently operates only two data centres.

Sharma said it was reassuring that ASIC is investigating what he called serious allegations. He argued the saga is bigger than one failed float, saying credible claims of misleading representation and serious conflicts of interest go to the heart of market trust. Action, he said, must not only be taken but be seen to be taken.

Firmus was co-founded by Oliver Curtis, husband of public relations consultant and influencer Roxy Jacenko. Curtis served a year in jail in 2016-17 for insider trading, then co-founded Firmus in 2019 as a bitcoin mining company. He, co-founders Tim Rosenfield and Jonathan Levee, and his father Nick Curtis would have held shares worth more than $10 billion at the planned price.

What comes next is ASIC's assessment of the material it gathers from the lead managers, and whether that leads to anything beyond the current preliminary inquiries.