PGC in talks to sell off Perpetual

Pyne Gould Corporation says it has received approaches from a number of parties interested in buying all or part of its subsidiary Perpetual Group.

Pyne Gould has been under pressure from the Financial Markets Authority after Perpetual agreed to loan $28 million from its Perpetual Cash Management Fund to related business Torchlight Fund No1 LP.

The money has since been paid back but legal action is pending on Friday from the cash fund's statutory supervisor Trustees Executors.

Pyne Gould managing director George Kerr said the board believed there was merit in a complete separation between Perpetual which was retail-focused and the wholesale- focused Torchlight.

Torchlight would become Pyne Gould's core business if Perpetual is sold.

"PGC is engaged with a number of parties with a view to divesting the Perpetual businesses. No definitive agreements have been reached as yet, and if and when this point is reached, PGC will make an appropriate announcement to the market," Kerr said.

One of the interested parties is believed to be the management of Perpetual headed by chief executive Patrick Middleton. A spokesman for Pyne Gould said he could not comment on who the possible buyers were.

Kerr said if part or all of Perpetual were sold Pyne Gould would plough more money into Torchlight, allowing it to invest in more distressed assets.

It would also consider listing the business in Australia and the United Kingdom where it was now focused.

"An inevitable outcome of this strategy is that PGC will have minimal, if any, exposure to New Zealand," Kerr said.

"Torchlight's focus to date has been Australia but is now increasingly focused on the United Kingdom.

"Accordingly, the board of PGC has commissioned its international legal and accounting advisers, Baker & McKenzie and Deloitte, to evaluate the opportunity for PGC to list in either or both Australia and the United Kingdom."

Kerr said Pyne Gould's financial position had improved since his takeover bid this year which left him with a controlling stake of 76.3 per cent through Australasian Equity Partners.

Kerr said since the bid had ended Pyne Gould had paid off $22 million in debt and had positive cashflow.

Further details of Pyne Gould's performance would be released on August 31 at its full year result briefing.

Shares in Pyne Gould closed unchanged on 27c yesterday.