Sharechat Logo

Low-ball investor targets Unlisted platform with offer for Rural Equities

Tuesday 18th September 2012

Text too small?

Australia's Stock and Share Trading has again targeted companies on the Unlisted platform, with an offer to shareholders of Rural Equities that is about 29 percent below their market price.

Stock and Share is offering to buy shares at $2.30 apiece, below the $3.22 they traded at yesterday.

Stock and Share is owned by John Armour and his firm is represented in New Zealand by Andrew Kennedy of Auckland law firm Prudentia Law. Kennedy confirmed he represents the Australian firm, which he says is complying with New Zealand's financial regulations.

"The FMA has been in discussion with it and there are requirements that my client is meeting in terms of disclosure and how the offers are vetted," Kennedy told BusinessDesk.

The proposal is the third such approach to Rural Equities' shareholders in the past 12 months. Wellington-based investment firm Rangatira's Unlisted shares were also targeted last month with a low-ball offer.

Firms such as Stock and Share take advantage of corporate regulation that allows them to demand a company's shareholder list. They often target holders of smaller parcels of shares who may not keep track of the price and are attracted to the prospect of quick cash.

The offers are legal and the targeted companies generally respond by pointing out how much of a discount the offer is to recent trading and urging shareholders to get proper financial advice before accepting.

"At the end of the day the investor is the one that has to make the decision," said David Wallace, Unlisted's market manager. "These sorts of offers just create confusion and despondency about New Zealand's capital markets and I hope the FMA (Financial Markets Authority) responds appropriately."

Rural Equities, the farming group controlled by the family of businessman Selwyn Cushing, says the latest approach has been made to major shareholders as well as holders of small parcels.

NOTE: please be advised to read full articles from Business Desk Website, you will have to pay a subscription fee on their website.

  General Finance Advertising    

Comments from our readers

No comments yet

Add your comment:
Your name:
Your email:
Not displayed to the public
Comments to Sharechat go through an approval process. Comments which are defamatory, abusive or in some way deemed inappropriate will not be approved. It is allowable to use some form of non-de-plume for your name, however we recommend real email addresses are used. Comments from free email addresses such as Gmail, Yahoo, Hotmail, etc may not be approved.

Related News:

NZ dollar holds gains on improved dairy, bank capital outlook
MARKET CLOSE: NZ shares gain; banks rally on Reserve Bank capital decision
NZ dollar rises; bank capital rules less harsh than expected
RBNZ relaxes capital requirements, allows preference shares, extends phase-in
NZ dollar extends gain amid mixed US data, possible trade progress
MARKET CLOSE: NZ shares dip on eve of major regulatory decisions
NZ dollar sees off global headwinds, holds above 65 US cents
NZ dollar holds above 65 US cents; dairy auction prices mixed
Dairy index falls on weaker butter, milk fat demand
MARKET CLOSE: NZ shares join global decline; US tariff move weighs on exporters

IRG See IRG research reports