NZ stocks: Powerco & Fonterrra hog the limelight

12.00pm

News that Australian firm Prime Infrastructure had bought 53 per cent of listed energy firm Powerco dominated morning trade, which saw the sharemarket lose ground.

At 11.30am, the benchmark NZSX-50 index was down 12.24 points at 2751.98, while the NZSX-All capital index was down 5.10 points at 925.69.

Turnover was $69.1 million.

Market heavyweight Telecom was down 4c at 603 on turnover of $23.8 million.

Among the 120 stocks traded were 20 rises and 50 falls.

Hamilton Hindin Greene broker Grant Williamson said the New Zealand market had taken its lead from those offshore.

Shortly before the market opened, Powerco confirmed that 53 per cent of its shares had been sold to Prime for about $360m.

Powerco shares dumped 10c to 205.

Powerco expected Prime to shortly issue a full takeover offer, which it would have independently assessed.

"The price of 215 is probably less than what a lot of people were expecting... I think the debt security element in the takeover consideration has certainly put a few investors off," Mr Williamson said.

Courier company Freightways today posted a $15.4m net profit for the June year. It would issue a 6.9c per share fully imputed dividend.

Freightways shares were down 2c at 255.

"Even though the stock's slightly off, the market expected this result," Mr Williamson said.

"It was well ahead of the prospectus forecast and they seem very confident going forward as well.

"The people who got into the book build some time ago have done extremely well."

Meanwhile, brokers say Fonterra sold its remaining shares in Wrightson, 8.4 per cent of the company. Some 11.7 million shares traded at 142 each for a total of $16.7 million.

It was not immediately clear who had bought the stake.

Waste Management today posted an improved June half profit of $12.7 million, up 49 per cent on the $8.5 million for the previous same period.

It issued an interim dividend of 9.9c per share with imputation credits of 4.8c. Waste Management's directors expected the firm to post a net surplus of $24m for the December year, up 30 per cent on the 2003 year.

"That's a good result. I think it shows they back on the growth path," Mr Williamson said.

Waste Management shares were up 12c at 487.

Other shares on the move included Air NZ down 1c at 39, Auckland International Airport down 6c at 704, Fisher & Paykel Appliances down 5c at 470, Infratil down 2c at 305, Michael Hill International up 1c at 617, Steel & Tube down 5c at 436, Toll NZ up 3c at 190, and The Warehouse down 1c at 440.

Also today, CHH goes ex dividend, while Asia Pacific Breweries is to mail its offer for DB Breweries.

- NZPA