Battle heating up in bid for slice of Enza

By PHILIPPA STEVENSON agricultural editor

Timaru millionaire and major orchardist Allan Hubbard is expected to turn up the heat in a battle for shares in monopoly apple marketer Enza.

Sir Ron Brierley's Guinness Peat Group (GPG) and investment bankers FR Partners began a shock strike on Enza's 20 million shares last Wednesday, seeking a 40 per cent stake. By Friday each had gained 6.4 per cent at $1.50 a share.

Enza announced the counter-offer late on Friday, and yesterday chairman John McCliskie confirmed that Mr Hubbard's interests were keen to buy a substantial number of shares at a price above the GPG/FR offer.

Last night, John Stark, a partner in Timaru accountancy firm Hubbard Churcher, told the Business Herald the new bidders were "still up in the air and chewing the fat," but expected to detail their offer this week.

Mr Hubbard, Mr Stark and chairman of corporate orchardist Grocorp, Grant Sinclair, are directors of Hawkes Bay Apples, which bought the largest apple producer, Eastern Equities, in June.

Other interests associated with Mr Hubbard, whose accountancy firm puts together syndicates to invest in rural assets, recently took an 80 per cent stake in Grocorp. A finance company with which he is linked is understood to provide Grocorp with a lending facility.

The web of interests is believed to have about a 10 per cent shareholding in Enza and produce around one million cartons of the national 20 million-carton apple crop.

GPG chief Tony Gibbs said he had known of Mr Hubbard's intentions since Thursday, before his company and FR declared their offers unconditional.

The Hubbard bid was "the industry's worst nightmare and absolutely politically unacceptable," he said.

It would let one huge grower dominate the industry while the corporate GPG and FR Partners would be dispassionate, working for all the growers. No deals would be struck with Mr Hubbard and the GPG/FR offer would continue, he said.

Meanwhile, FR Partners executive director Bill Birnie said, in a "huge coincidence" he was asked by Enza representatives to consider taking a seat on the Enza board the day of the launch of the GPG/FR offer.

He thought it "surprising they would like me to go on the board in one breath and not be a shareholder on the other."

"They are looking for certain skills and obviously they think we can provide them. We intend to provide them, but we would rather do it as a shareholder than just as a non-shareholder director."

Mr McCliskie said each bidder had their strengths. Mr Hubbard had a sizable growing stake in the industry, and both GPG and FR Partners had recognised that Enza brought bankability to the industry.

The two corporates supported growing the Enza brand and the long-term innovation of new apple varieties.

A number of grower groups had also been buying tens of thousands of shares for some time, he said.

Meanwhile, Pipfruit Growers NZ has advanced plans to set up a grower/shareholder trust to unite the voting power of some 1600 small shareholders who hold on average 14,000 shares.

Chairman Phil Alison said the concept would be sent to growers by Friday.

The former single-selling Enza became a grower-owned public company on April 1 and has yet to produce financial accounts.

Other apple exporters are permitted to sell New Zealand apples only if they complement Enza.