The federal government is understood to have called for final bids for the Australian Securities and Investments Commission Registry on August 29.The sale details were provided ahead of Tuesday’s federal budget and will be welcomed by bidding parties after they submitted indicative offers back in February.
Interested parties were told final bids will be measured against “specified evaluation criteria.”
They were asked to respond to alternative economic structures in the indicative bid phase and so are keen to see what path the government takes.
Canada’s Brookfield and Teranet, owned by fellow Canadian Borealis Infrastructure, are among potential acquirers and find themselves up against Australian rivals Link Administration Holdings, Computershare and the recently-acquired Veda. Morgan Stanley’s infrastructure arm is also in the process.
Different bidders are understood to have submitted different requests as part of the process, with some seeking full ownership of the platform while others are happier to play only a role in developing and implementing new technology platforms.
Either way, the government has told all bidders it intends to retain ownership of ASIC Registry’s data.
Greenhill is running the sale for the government.
Australian Securities and Investments Commission chairman Greg Medcraft has defended the sale of its lucrative database registries, saying the government has every right to test the market.
But the regulator has vowed to ensure any integrity and privacy concerns surrounding the privatisation of the database would be addressed before any potential sale.
The Department of Finance earlier this month received 10 expressions of interest for the potential $3 billion sale of the registries.
A parliamentary committee in Brisbane on Thursday heard the sales process could be completed by the second half of next year.
When questioned why the Turnbull government – which Treasurer Scott Morrison described as having a “revenue problem” – would sell the profitable data registries, Mr Medcraft told the committee the Commonwealth was right to gauge market interest.
PRIVATISING PUBLIC INFORMATION: THE SALE OF THE ASIC BUSINESS REGISTERS
The Federal Government has commenced the tender process for sale of the Business Registers currently operated by ASIC.
The model of future operations implied in the call for registration of interest looks to involve the private operator relying on revenue from sale of information and products based on the information in the register, with Government continuing to set and receive the fees charged to companies and others required to lodge information. An alternative model would involve the operator setting and receiving fees from those required to lodge information, and making collected information available free of charge to users.
Either model (or variants in between) requires regulatory oversight of fees and charges because of the monopoly position of the operator. Maximising social benefits from the creation and use of information seems more consistent with the alternative model (or some variant thereof), but this may not maximise government revenue from the sale process. It is important that the distinction between the registry sale (and fees/taxes charged to those required to register) and the current investigation of a funding model for ASIC based on levies on regulated entities (rather than government budget allocation) be made clear. They are not interrelated, and the fees involved in each are based on quite different justifications.
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