NZ stocks: Sale of SIA's Air NZ stake enlivens market

12.15pm

The sale of Singapore Airline's 37.8 million shares, comprising 6.3 per cent of Air New Zealand, was the highlight of trading on the sharemarket this morning.

The block was placed with institutions at 163/share -- a 3 per cent discount to the previous close of 168. Air NZ shares were placed in a trading halt yesterday ahead of the sale, and were unchanged at 168 at 11.25am once trading resumed.

SIA, which at one stage owned 25 per cent of the airline, but had that diluted when the company was recapitalised by the Government in 2001 after the collapse of Ansett Australia, will book a loss of close to $500m on its New Zealand investment.

The Air NZ sale boosted market turnover to 59.7 million shares worth $101.6m.

The benchmark NZSX-50 gross index was down 3.45 points at 2857.37 at 11.35am, while the NZSX all capital index was down 0.64 at 949.63.

The market was dragged down by Telecom, which was off 2c to 599, having traded as low as 597.

There was still good turnover in Powerco, with some 2.4m shares traded. It was down 1c to 211. The takeover saga by Prime Infrastructure took yet another twist last night when the Takeovers Panel said the deal-saving arrangement announced last night by the New Plymouth District Council may not comply with the Takeovers Code.

On Monday, the NPDC said Australia's Prime would put more cash into its bid and the council's advisers, PricewaterhouseCoopers (PWC), had secured a binding agreement to sell any bonds the council received for its Powerco stake beyond the agreed 37.5 per cent of the total price to Sydney-based broker Tricom.

The panel is investigating whether this amounts to a differentiated offer.

There was very little else of interest on the market.

Auckland Airport recovered 2c to 708 following its 9c loss yesterday. Media reports over the weekend said that cabinet was set to approve a second international airport for Auckland at Whenuapai.

NGC Holdings fell 1c to 308. Indicative bids for NGC are due today for its 66 per cent stake in the company held by AGL of Australia.

Rural services company Pyne Gould Guinness rose 3c to 187 and rival Wrightson rose 2c to 149 after Fonterra yesterday lifted its payout forecast 20c to $4.05/kg for dairy farmers.

All up, there were 35 stocks up and 31 down among the 120 traded.

- NZPA