Keen Bidder
The Wellington investment company behind a takeover bid for Rainbow's End owner New Zealand Experience says the acquisition would be a good fit with its other investments.
Rangatira, which signalled a formal bid for New Zealand Experience last week, runs a private equity style operation and has a number of investments including a 50 per cent stake in small-goods producer Hellers and 51 per cent of Rotorua tourism operator Polynesian Spa.
Rangatira chairman Murray Gough said it wasn't trying to make a tourism play with the takeover bid.
"We don't see Rainbow's End as a significant tourism destination," Gough said. "We have had a good look at the company and we like what it is doing.
"It fits in well with our portfolio."
Gough said Rangatira had recently been investing in start-ups like accounting software firm Xero and it was now looking for investments to balance that.
"Rainbow's End would help us achieve that balance."
New Zealand Experience has been on and off the market for a number of years with its majority shareholder the Trustees of the Estate of George Ryerson Gardiner keen to cash up their investment.
The estate has already agreed to sell its 74.86 per cent stake to Rangatira.
Rangatira, which is listed on the unlisted exchange, has an interesting history and ownership.
It is 51 per cent owned by the JR McKenzie Trust - a philanthropic trust set up by Sir John McKenzie in 1940 - the founder of McKenzie's retail stores. Other shareholders in Rangatira include Outward Bound and a number of the McKenzie family.
The formal offer documents are expected to be sent out to shareholders in the next few weeks along with an independent report from the board.
Shares in New Zealand Experience closed unchanged yesterday at 40c.
Ups and Downs
Units in Fonterra's Shareholders Fund have had a roller coaster ride in their first week of trading.
The units hit $6.66 on sharemarket debut last Friday, a 21 per cent premium to the $5.50 issue price and continued to climb to $6.90 on Monday.
However, since then the unit price has fallen back.
Harbour Asset Management research analyst Oyvinn Rimer said there clearly was a bit of euphoria in the first couple of days.
Rimer said the $6.90 spike was probably caused by a lot of people who didn't get as many units as they wanted through the initial public offer.
But he said it was still too soon to predict where the funds' unit price might sit in the longer term.
"I was surprised at how aggressively it got priced - close to $7 - that was pretty firm."
Rimer said the turnover volume was very high in the first few days with 20 to 25 per cent of the initial stock on issue traded. "That is phenomenal volume."
Units in the fund closed up 9c yesterday at $6.69.
Knock-Back
The Commerce Commission's regulatory knock-backs for Chorus will be a blow for AMP Capital.
The Wellington fund manager is the largest substantial shareholder in Chorus whose share price plummeted this week after the commission made two regulatory announcements about wholesale pricing.
Chorus shares fell from $3.40 to $2.78 on the news - well below the $3.21 the company first traded at after splitting from Telecom in November last year.
In May, AMP applied for special compensation from the Government allowing it to buy up to 15 per cent of Chorus.
In September the fund manager had acquired as much as 11.26 per cent.
But fortunately AMP has been reducing its stake of late.
Before Monday's announcement it was down to 7.98 per cent.
Since then AMP has reduced its stake further to 6.55 per cent.
Chorus has been seen as a strong dividend yield play but the latest announcements has been a strong reminder that the company may not be as defensive a stock as some had assumed.
Chorus shares closed up 6c yesterday at $2.85.
Question Time
Postie Plus Group could be in line for some tough questions from shareholders at its annual general meeting in Christchurch today.
The retailer shed 13 per cent on Wednesday after it revealed potential breaches of its banking covenants for November 2012 and January and April 2013.
The company seems to have had ongoing banking issues since May when it first told the market that a review of its April financial accounts and third quarter figures showed it had not met the interest to earnings before interest and tax ratio covenant for the rolling 12 months to April 2012.
Postie then reported further potential problems in October.
So far it seems the group's bank, the BNZ, has been very supportive.
The company says it is on a growth acquisition trail but Stock Takes reckons it should get its own house in order before looking to buy anything else.
Shares in Postie Plus closed up 1c at 21c yesterday.
Second Go
Auckland Council has re-booted its retail bond offer.
The council pulled its initial bond issue in October after the Supreme Court ruled that local authorities would have to set aside provisions for weathertightness claims on commercial properties, as well as residential properties.
Details are expected to be announced on Monday but are likely to be similar to the initial offer which was a six-year bond aiming to raise $125 million with provision for a further $50 million in oversubscriptions.
