Rival bid emerges for Rural Equities

Thursday 20th May 2004

A Sir Selwyn Cushing led bid to take control of Rural Equities looks set to be trumped by a sweeter and full takeover play by private investment group St Laurence.

Sir Selwyn's company, H and G, currently owns 25.3% of Rural Equities, while its associates own about 9.3%.

H and G is offering $1.25 a share to secure another 15.54% of Rural Equities, which would give it effective control with a 50.1% cornerstone.

However, a source has told NZPA that a rival bidder, in the form of Wellington-based St Laurence, is set to reveal a sweeter offer in the region of $1.50 a share to acquire 100% of Rural Equities.

The St Laurence offer would have the attraction of being a full takeover offer.

St Laurence is holding a press conference in Wellington at 11am tomorrow.

"The purpose is to brief journalists on an offer St Laurence Equities... is making for Rural Equities -- the details of which will be announced at the conference," it said in a statement.

"This is a significant announcement for St Laurence, marking a further stage in their development and diversification," the statement said.

H and G joined the new unlisted market early in March.

Rural Equities was earlier this year split from stock and station agency Williams and Kettle, which is 19.9% owned by H and G.

According to a PricewaterhouseCoopers report on Rural Equities in November last year, the company made a tax-paid surplus of $1.1 million in the July 2003 year, up from $946,000 the previous year.

Rural Equities owns a 32% stake in New Zealand Property Trust and the trust's management contract -- valued at $1.93 million in June 2003.

In 2004, that management fee was expected to rise to $2.1 million.

New Zealand Property Trust owns about 30 farm properties and a 856ha forest near Ngaruawahia with a total net current value of about $103 million.

The farm properties are leased to suitably experienced farmers -- most are agreed under a 15-year period with lease reviews every 18 months.

Williams and Kettle shares closed up one cent at $2.73. H and G joined the new unlisted market early in March.

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