Bridgecorp takes bath over rule breach

By Nick Stride

Friday 12th November 2004

Auckland investor Hugh Green has lifted his stake in Dorchester Pacific to 17.8% because he "didn't want anyone else to become the dominant shareholder."

Green's Hugh Green Investments is now Dorchester Pacific's largest shareholder after buying a 4.8% stake from Rod Petricevic's Bridgecorp Holdings.

Bridgecorp is reduced to 14.1%, from 19.9%, following a punch-up with the Takeovers Panel which saw the panel effectively order the company to sell down.

While Green did not consider his purchase to be particularly cheap, the price was within the range in which Dorchester shares traded that day. Bridgecorp has taken a haircut.

It paid Dorchester's managing director, Brent King, $4 each for the shares. Green paid $2.81, so Bridgecorp has lost $1.2 million. It had to sell the shares after the panel found a "lock-up" agreement with King breached the Takeovers Code.

The Securities Commission is investigating whether the deal breached the Securities Act.

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