The sharemarket was dominated yesterday by Air New Zealand, whose shares nosedived after hitting recent highs on Tuesday.
Air New Zealand has rejected a takeover bid by Qantas and will ask the Government to let Singapore Airlines "substantially increase" its shareholding in the company through a share placement at $1.31
a share.
Air New Zealand's domestic A shares closed down 11c at $1.10 and the Bs lost 30c to $1.33.
ABN Amro institutional dealer Nigel Scott said there were three reasons behind the fall in both A and B shares.
"First, Air New Zealand did state there would be some form of capital raising. Two, they stated it would be below the $1.31 level that Singapore Airlines was looking to add to its current shareholding issue. And three, whether the As and the Bs merge as in Qantas, and just have one unit."
He said the share price was now only slightly up on its level at the time Ansett Australia's planes were grounded.
"It's a matter of watch this space again. Yesterday, it was just the first cut - what Singapore Airlines' wish list is and I think what Air New Zealand's independent directors' [wishes] are.
"Now you've got to look at what the Government does. The hard work really starts from here."
Air NZ shareholder Brierley Investments fell 1c to 66c.
The NZSE-40 capital index fell 5.06 points, or 0.25 per cent, to 2035.64 and the small companies' NZSE-SCI capital index rose 4.24 points to 5427.38.
Turnover of 25.83 million valued at $63.77 million was topped by PDL Holding's $12.05 million turnover as French company Schneider Electric tightened its grip on the company. PDL rose 96c to $10.96.
Telecom traded up 8c to $5.45 on very light volume after losing ground on Tuesday because of continuing weak telco sentiment. Telstra was down 5c at $6.90.
Lion Nathan rose 8c to $5.32, and investment group GPG was up 5c at $1.73.
"GPG's had its best little period for a long time, recovering nearly all the one-for-10 bonus it went ex a few weeks ago," Mr Scott said.
Forestry stocks were down. Carter Holt Harvey fell 2c to $1.73 and Fletcher Forests 1c to 29c, affecting Rubicon, which lost 2c to 61c.
Natural Gas Corp lost 5c to 95c after it said it was reviewing the value of its electricity business because of high wholesale prices.
NGC said it was also negotiating a programme to alleviate the impact of high electricity prices.
Casino operator Sky City lost 45c to $10.45 near the end of the session. Nearly all trades during the day were around $10.85/$10.90, Mr Scott said.
Fisher & Paykel lost 5c to $11.05, Montana 1c to $4.80, Richmond 4c to $2.36 and TrustPower 1c to $3.25.
Sky TV rose 4c to $3.44, Tranz Rail was up 2c at $3.60 and UnitedNetworks gained 5c to $8.55.
- NZPA
The sharemarket was dominated yesterday by Air New Zealand, whose shares nosedived after hitting recent highs on Tuesday.
Air New Zealand has rejected a takeover bid by Qantas and will ask the Government to let Singapore Airlines "substantially increase" its shareholding in the company through a share placement at $1.31
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