NZ stocks: Sky City deal on Christchurch casino hogs limelight

News of Sky City Entertainment securing a 41 percent stake in Christchurch Casino dominated an otherwise moderate day's trading on the New Zealand sharemarket today.

At 5pm, the benchmark NZSX-50 gross index was up 3.39 points at 2593.44, while the NZSX-All Capital Index was down 0.12 points at 875.87.

There was $107.3 million worth of shares traded on NZX today, and among the 152 stocks to move were 68 rises and 39 falls.

Despite the market finishing on a positive note, market heavyweight Telecom closed down 1c at 574 on turnover of $55.5 million.

The market's attention was firmly on Sky City's $93.8 million conditional purchase of Aspinall's 40.5 percent stake in Christchurch Casino.

Sky City shares closed down 5c at 440 on turnover of $2.6 million.

ABN Amro Craigs broker Matt Willis said the dip in Sky City's share price reflected some unease in the market.

"The jury is probably out on whether they've made too many (acquisitions) lately," Mr Willis told NZPA today.

The share price had fallen because Sky City had, perhaps, been "growing by acquisition maybe a little more aggressively than the market would like to see," he said.

In February it paid $A195 million ($221 million) to buy Darwin's only casino from Las Vegas-based MGM Mirage. In 2000 it paid $238 million (including working capital) for Adelaide Casino.

Sky City has also paid $25 million for a 33 percent holding in Internet betting company Canbet.

Sky City has yet to secure regulatory approval for its latest deal from the Commerce Commission and the Casino Control Authority.

ASB Securities broker Stephen Wright said concerns about Sky City's relationship with fellow Christchurch Casino owner Skyline could also be concerning investors.

"Bearing in mind Skyline has been anti Sky City buying into it, I guess there will be a pause while people think of any ramifications of that," he told NZPA today.

"If you are going to have to two hostile main shareholders it often doesn't make for a good company," he said, noting that some investors believed Sky City should focus on its Auckland operations.

In other market news, NZ Alternative Exchange-listed natural health products company Comvita Ltd today issued more details of a $7.5 million capital raising it announced last month.

Mobile radio communications company TeamTalk said it was planning an $8 million initial public offering (IPO) and sharemarket listing.

Meanwhile, rural services company Wrightson was up 3c at 124.

On Friday, the company announced it was forming a 50/50 joint venture with Pyne Gould Guinness to amalgamate their wool handling and warehousing businesses.

Trustpower was trading at 390, exactly half of Friday's closing price, after a two for one share-split.

Other shares on the move included: Auckland International Airport down 11c at 665, AMP up 1c at 656, Fisher & Paykel Healthcare down 9c at 1210, Sanford up 7c at 492, Baycorp Advantage up 8c at 313, Hellaby down 16c at 500, Carter Holt Harvey up 5c at 223, and Michael Hill International up 5c at 538.

Overseas, the Dow Jones closed up 97.26 points at 10,470.59, the Standard & Poor's 500 Index rose 9.63 points to 1141.80, and the Nasdaq Composite Index finished up 42.16 points 2057.17.

- NZPA