Monday 27th February 2012 2 Comments
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Corporate raider Ron Brierley has reconvened some of his old gang via an A$2 million placement for his latest enterprise, ASX-listed Mercantile Investment Co.
Former Brierley International executive and Guinness Peat Group director Ron Langley and Gibsbourne Pty, a subsidiary of ASX-listed Ariadne Australia whose executive director is long-time Brierley lieutenant Gary Weiss, will each subscribe for A$1 million, or 12.5 million shares, in Mercantile, with the placement expected today.
The shares were placed at 8 Australian cents apiece, a premium to their last traded price on the ASX of 7.3 cents. The company’s market value is currently A$18.3 million.
The funds will be used for “general investment purposes”, Mercantile said in a Feb. 23 statement to the ASX.
Brierley and his team at GPG were ousted last year in a shareholder revolt over plans to split up the investment company. That firm is now in wind-down mode, selling assets to return capital to shareholders.
Mercantile is at least the third diversified investment vehicle for Brierley, who built GPG after being forced out of Brierley Investments in the early 1990s. The empire named for him had struggled to recover from the 1987 sharemarket crash and now exists as GuocoLeisure, with its primary listing on the Singapore stock exchange.
Brierley seized control of Mercantile, then called India Equities Fund, last month when shareholders agreed to a deal giving him 54 percent of the company and its chair in return for his stakes in Copper Strike, Trinity Group, ING Community Living Group, Australian Pharmaceutical Industries and Trojan Equity.
He emerged as a substantial shareholder in India Equities last July when he bought 5.05 percent of the cashed-up investment vehicle for A$293,714. That same month he lifted his stake to 14.8 percent.
Last year, the 74-year-old investor told the Sydney Morning Herald the new fund won’t be anything “too big” or “too ambitious,” but that he isn’t planning on exiting the corporate world any time soon.
Brierley has also reconnected with old colleagues in New Zealand where he emerged as a co-investor with Selwyn Cushing, a former Brierley Investment chairman, in Wellington’s struggling upscale department store and property owner Kirkcaldie & Stains.
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