Pyne Gould plunges 19 percent to record low after annual meeting

Thursday 29th November 2012 1 Comment

Shares in Pyne Gould Corp plunged to a record low after yesterday's annual meeting where chairman Bryan Mogridge told investors the firm will probably quit New Zealand.

The stock sank 19 percent to 22 cents in trading this morning, with about 0.08 percent of shares on issue changing hands. The shares have shed a third of their value this month, and are now trading at a 41 percent discount to what managing director and controlling shareholder George Kerr paid earlier this year.

Kerr paid 37 cents a share to take control of the company with 77 percent, while warning that the difficult process of selling assets meant Pyne Gould was no longer a generator of dividend income.

The trading comes a day after the company's annual meeting in Auckland, where chairman Mogridge repeated his warning that the company won't pay dividends and told investors the board is "seriously considering the domicile of the company," which is unlikely to be New Zealand, and will update the market on its decision when it is made.

The firm has almost exited its last New Zealand asset, with Kerr overseas trying to finalise a deal to sell the Perpetual wealth management assets. It had previously sold the corporate trust unit in a management buy-out.

Pyne Gould is looking to get a return of more than 15 percent over a decade on its $97.5 million of net assets.

Its Torchlight Investment Group owns 19.7 percent of investor Torchlight Fund 1, which runs until 2019, and Torchlight Fund 2, which holds remaining bad loans carved off when Marac Finance was sold into Heartland New Zealand.

Pyne Gould's Torchlight Securities owns 27 percent of Equity Partners Infrastructure Company No. 1 which in turn owns 17 percent of UK motorway services company Moto International Holdings.

BusinessDesk.co.nz

Comments from our readers

On 29 November 2012 at 3:08 pm Allan said:

I sent the following emails to PGC and the FMA and NZX today, be interesting to see if I hear back from any of them, I am not holding my breath waiting to hear from PGC Hi Whilst I am sure you dont care I have today sent the following to both the FMA and the NZX Mr. Kerr by his actions in not even bothering to show up to the AGM gives me absolutely no confidence that he has even the smallest of concerns for us minority shareholders He, by his actions over the Queenstown property purchase and subsequent extremely strange media releases has presided over the destruction of half of the Companies value, if he didn't control the Company you would not put him in charge of a shovel As to his so called independent directors including and probably especially the Chairman they should be ashamed of themselves I doubt you will bother to reply to this but hopefully the FMA and or the NZX can assist smaller shareholders to retain some value in the trainwreck that is PGC under the "care" of Mr. Kerr Please cc this email to all Directors of the business Allan Sims Dear Sir/Madam, For my sins I am a shareholder in PGC The latest actions around the annual meeting clearly confirm that Mr. Kerr who didn't even bother turning up,has no intention of treating minority shareholders fairly and his board will do as its told The discussions around PGC delisting in NZ and relisting overseas give me great concern that he will head to an area where the rules are more lax than here and what small rights I have in NZ will be even less in the future This casts a real shadow over the NZX market as if Companies have the right to treat minority shareholders with such disdain whilst being a NZ listed Company I for one shall take my funds and go back to property Would you kindly advise what, if any, rights as a minority shareholder I have in this matter and what the rules are around delisting in NZ and relisting overseas that may provide me some protection? many thanks Allan Sims