New Zealand shares fell, with Fletcher Building and Freightways dropping, while A2 Milk Co gained on news a competitor may be taken over at a premium.

The S&P/NZX50 Index dipped 1.96 points, or 0.03 per cent, to 7.035.54. Within the index, 21 stocks fell, 19 rose and 10 were unchanged. Turnover was $108.3 million.

Fletcher Building led the index lower, down 1.8 per cent to $10.14, while Freightways dropped 1.7 per cent to $6.87 and Meridian Energy declined 1.7 per cent to $2.665.

A2 Milk Co was the best performer on the index, up 2.7 per cent to $2.29. UK consumer giant Reckitt Benckiser is in talks to buy Mead Johnson Nutrition, the US-based baby-food maker, for US$90 per share, nearly a 30 per cent premium. The negotiations value Mead Johnson's entire share capital at approximately US$16.7 billion (NZ$22.9b), according to Reuters.

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"It had a strong day based on the Mead takeover bid for one of their peers, that's certainly helped the performance today," said James Lindsay at Nikko Asset Management. "There's a couple of dynamics there. The volatility in the market, their peers in Australia have had trouble and Comvita as well, that secondary or grey market into China has been fraught with difficulties over the last few months. A2 has been well-supported out of Australia, their ownership levels are quite high there. They're owned a lot by retail investors and they seem to be a lot more quick with their ins an outs, it's a bit of a trading stock for some of those people so that adds to the volatility in that name."

Sky Network Television dipped 0.4 per cent to $4.55. US fund manager BlackRock has cut its holding of Sky to 9.3 per cent, from the 10.3 per cent previously held.

"That didn't assist the price, with people still waiting for their likely poorer result and for the ComCom decision on the Vodafone merger, that's probably more weighing on them," Lindsay said.

Fonterra Shareholders Fund units were unchanged at $6.19. The dairy cooperative's chief executive Theo Spierings told institutional investors at a briefing that it remains on track to meet its 2025 target to process 30 billion litres of milk from five to six milk pools, generating $35 billion in revenue as it pursues a strategy to process more higher value products.

Outside the benchmark index, Veritas Investments spiked 60 per cent to 24 cents. It has sold its Nosh food supermarkets to Gosh Holding for $3.98m, with the transaction due to be completed on February 10. The net sale proceeds after post completion adjustments will be used to repay Veritas group's bank debt to ANZ Bank New Zealand.

Opus International Consultants dropped 2.1 per cent to 93 cents. The engineering firm posted a $29.9m loss on impairments against its Canadian oil and gas business, with revenue dropping 6.8 per cent to $470.9m.

Abano Healthcare was unchanged at $9. The board has reiterated its recommendation that shareholders reject a takeover offer from its biggest shareholder, saying it had gained no traction and the share price would drop if it was successful.

Briscoe Group was unchanged at $4.08. Managing director and majority shareholder Rod Duke said profit rose about 25 per cent to $59m in the year ended January 29 as the household and sporting goods retailer resisted discounting to protect its gross margins.