Stocks to watch: Affco, Allied Farmers, Canterbury Building Society

Wednesday 21st July 2010

Talley's has made a full takeover bid for Affco, Allied Farmers shares rose yesterday on news Westpac would give it more time to repay debt and restructure its business, while Canterbury Building Society says it's well positioned to continue growth.

Affco Holdings (AFF): Nelson-based conglomerate Talley's Group yesterday announced a full takeover bid for the remaining 23.7% of the meat processor that it doesn't already own, offering shareholders the current trading price of 37 cents a share. The price is the same as that offered for 23.46% of AFFCO belonging to the Spencer family vehicle, Toocooya Nominees on June 11, to add to the 52.8% already owned by Talley's Group.

Allied Farmers (ALF): The finance company which took over the Hanover loan book last year rose 4.6% to 46 cents yesterday on news that the company had gained a six-month extension of its loan facility with Westpac, giving the finance company more time to repay debt and restructure its business. Allied has $16.5 million outstanding and had an overdraft facility of $2.5 million that was set to expire on July 1. The extension, its second, is until March 31.

Canterbury Building Society (CBS): The only listed building society told shareholders at their annual meeting that recessionary conditions were more entrenched than it had previously envisaged. Still, the firm was "well positioned to maximise opportunities and achieve continued growth." It told shareholders that a further announcement on the proposed merger with South Cross Building Society and Pyne Gould Corp.'s Marac unit is due in mid to late August. The shares last traded at $2.90 on July 13.

NZ Farming Systems Uruguay (NZS): The South American dairy farm operator, rose 2% to 54 cents yesterday, adding to the previous day's 29% surge after Singapore's Olam International said it wanted to acquire shares in the company it didn't already own at 55 cents apiece.

Telecom (TEL): Alcatel-Lucent New Zealand, Telecom's technology partner on their XT Network, said in its report to the Companies Office that the two had agreed to settle their dispute over network outages. Telecom rose 2.7% to $1.93 yesterday.

Themes of the day: The Kiwi dollar gained following the Reserve Bank of Australia's upbeat assessment of the economy that is New Zealand's biggest export market and as the Bank of Canada raised its benchmark interest rate as expected, keeping on track expectations for a hike this month by the RBNZ. Stocks on Wall Street gained as investors snapped up beaten-down shares of Goldman Sachs and home building permits unexpectedly rose last month.

Businesswire.co.nz

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