Wednesday 2nd May 2012
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Pyne Gould Corp has appointed a former journalist in Australia as independent director to meet its statutory requirements after an NZX waiver ran out this week.
Gregory Bright, a former economics reporter at the Sydney Morning Herald, will join the audit committee of Pyne Gould. The company was reduced to one independent director, chairman Bryan Mogridge, when Bruce Irvine left the board in January.
Pyne Gould gained the waiver in February, arguing that it was difficult to find someone to act as independent director when the company was under takeover offer by businessman George Kerr. His Australasian Equity Partners No 1 LP (AEP) venture with US hedge fund Baker Street Capital secured 76 percent of the company in a 37-cents-a-share takeover bid that closed in March.
Bright is chairman of his own conference production company, Binalong Advisory Services, the Pyne Gould statement says.
Kerr had wanted to take the company private and as AEP took control there has been an exodus of executives, led by managing director John Duncan. Kerr replaced Duncan with immediate effect.
Today, the Financial Markets Authority said it was looking into Pyne Gould’s related party transactions, which along with complaints about the wealth manager's governance, prompted auditor KPMG to quit its role with the company this week.
The market watchdog has "made inquiries over related party transactions involving PGC over the past two weeks," Pyne Gould said in a statement. The wealth manager is cooperating with the FMA, but is unable to make any further comment, it said.
KPMG said it had “unresolved differences as to whether certain transactions should be disclosed as related party transactions, and concerns over the adequacy of governance and management of financial reporting.”
Pyne Gould has since appointed Deloitte to oversee its central accounting functions.
Kerr became involved in Pyne Gould in 2009, taking a cornerstone stake after the company faced large writedowns on the value of its Marac finance unit's property loan book, which has since been divested.
Since his involvement, Pyne Gould has taken stakes in the Kerr-managed Torchlight funds, which specialise in squeezing value out of distressed assets, and its board approved increasing the capital available to Torchlight to “seek modest investments beyond the Torchlight fund.”
Pyne Gould's shares were unchanged at 32 cents today, and are 14 percent below AEP's takeover offer.
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