The Securities Commission has confirmed it is investigating the release of information by the New Zealand Stock Exchange about the possible inclusion of Allied Farmers on the benchmark index.
Shares in the finance firm and rural services provider rose early last week after the NZX issued a memo to members of a subscriber service, saying the stock was to be included in the top 50 index.
But prices fell again on Friday when the NZX issued a clarification, saying Allied's acquisition of Hanover's loan book has distorted the calculation it makes in ranking companies, and Allied won't be included this time round.
Both the New Zealand Shareholders' Association and Allied Farmers believe the information was material and price sensitive and should have been released to all investors at the same time.
And Allied Farmers says it's own modelling indicates shares in the company should have easily entered the NZX50.
A spokesperson for the Securities Commission says the NZX's regulatory arm will refer the matter to the Commission for investigation, but it will not comment further.
Shares in Allied Farmers fell 11% on Friday to 11 cents, and another 0.5 cents on Monday to close at 10.5 cents.