MARKET CLOSE: NZ shares fall; Z plunges after placement, Infratil falls

Thursday 1st October 2015

New Zealand shares fell, led by a sharp drop and heavy trading in Z Energy as the market digested nearly a third of the stock changing hands. Z shareholder Infratil also fell.

The S&P/NZX 50 Index dropped 7.94 points, or 0.1 percent, to 5585.420. Within the benchmark index, 22 stocks fell, 21 rose and seven were unchanged. Turnover was far higher than normal at $931 million, of which trades in Z made up $771 million.

Z, the transport fuel distributor and retailer, led the benchmark index lower, falling 12 percent to $5.81, below its placement price of $6 for transactions that saw Infratil sell 20 percent stake, raising $392 million, while the New Zealand Superannuation Fund booked $233 million and halved its stake to 10 percent. Infratil chief executive Marko Bogoievski said while Infratil supported Z and its proposed acquisition of Chevron New Zealand, "the current market provided an opportunity for a clean exit and the flexibility to recycle capital into new growth opportunities."

"Investors that took up the Z Energy offer would still be able to sell stock on the market today in order to settle their purchases and that's created a little bit of additional selling on the market," said Grant Williamson, director at Hamilton Hindin Greene. "The sellers achieved a very acceptable price. Having said that, institutions would have been the main takers of the placement and obviously for them to get large volume sometimes they have to pay a good price."

Infratil fell 1.6 percent to $3.01. The infrastructure investor followed its exit from Z with a bond issue to raise as much as $150 million as it looks to buy Australian renewable energy firm Pacific Hydro.

"Infratil did extremely well out of that Z purchase over a relatively short period of time as well," Williamson said. "They are very smart operators and have done very well, but that's not to say there won’t be more in that Z Energy price over time."

Trade Me Group, the online auction website, declined 2.5 percent to $3.57. Fonterra Shareholders' Fund, units of which give holders access to Fonterra Cooperative Group's dividend stream, declined 2 percent to $5.33.

Coats Group, formerly Guinness Peat Group, was the best performer on the benchmark index, up 3.2 percent to 64 cents. Fletcher Building, the construction and building supplies firm, rose 2.8 percent to $6.99. Spark New Zealand, the telecommunications company, gained 0.5 percent to $2.995.

Outside the benchmark index, Hellaby Holdings fell 0.3 percent to $3. The diversified investment company still expects higher annual earnings in 2016, but warned the first-half will be down from the year earlier.

Pyne Gould Corp rose 4.2 percent to 25 cents. The management firm controlled by managing director George Kerr risks having its shares suspended from trading for the second time in two years after again missing the deadline to lodge its annual report with the NZX. The company blamed the delay on auditors reviewing the accounts.

Pushpay Holdings, which yesterday raised $18.7 million in a private placement to fund its global expansion, jumped 14 percent to $6.85 after the mobile payment app developer said it more than doubled its customer numbers over the past six months, beating its forecast by about 10 percent.

BusinessDesk.co.nz

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