Goldman Sachs Group Inc.'s Australian arm agreed to improve its controls and communication with investors during the bookbuild process in share sale transactions under a court enforceable undertaking with the country's securities regulator.
A bookbuild is the process of generating, recording and capturing demand from potential investors for a capital raising transaction.
The Australian Securities and Investments Commission said it accepted the enforceable undertaking from Goldman Sachs Australia Pty Ltd. under which the company will conduct an internal review of policies, controls and supervision of employees engaged in equity capital market transactions that involve a bookbuild process and are lead managed by GS Australia.
The company agreed to implement changes to address any deficiencies identified during the internal review. Following the changes, Goldman Sachs Australia will provide an attestation from a senior executive to ASIC that the controls are adequate and appropriate.
The enforceable undertaking follows ASIC's investigation into an A$853 million block trade deal of Healthscope Ltd. shares managed by Goldman Sachs Australia in November 2015. ASIC had concerns about certain representations made by the company to potential investors about the minimum fixed demand in the deal, according to the regulator's press release.
Further, Goldman Sachs Australia will make a community benefit payment of A$500,000 as part of the enforceable undertaking, ASIC said.