Peter V O'Brien
Friday 19th December 2003
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New Zealand had its share of the bizarre, a notable matter being the number of companies adopting new names for various reasons, some understandable, others bordering on the incomprehensible.
There were nine listed company name changes in 2003, seemingly the most in one year since the heady, pre-crash days of the 1980s when the wideboys were at work acquiring anything that moved.
Alphabetically, in order of new names, we got Abano Healthcare for Eldercare, Finmedia for Dairy Brands after acquisition of 55% of UK business information and research company Hemscott, Hirequip New Zealand for Southern Capital, ING Property Trust for Paramount Trust, Kidicorp for Feverpitch International (changing a lack of public investment support for software business into childcare centres) and Training Solutions for e-Cademy.
The other three were Sealegs Corporation for IT Capital (before that known as Iddison Vietnam, a case where name changes failed to hide continuing operational struggles), Widespread Portfolios for NZIJ.co.NZ and Austral Pacific Energy for Indo-Pacific Energy. The last needs ratification at a meeting to be held in Vancouver on December 31. And a Happy Canadian New Year to you.
Austral Pacific decided on the name change to remove confusion with a similarly named Canadian company and reflect the company's primary New Zealand area of operations. The prospectus offering in New Zealand is raising $US5 million through a sale of four million units at $NZ2 each, a unit being a share and a half warrant, the latter exercisable for one year at $NZ2.10.
Both securities were to be listed on the NZSX. The issue was scheduled to be completed last week. Austral/Indo Pacific is a resource exploration company.
Widespread Portfolio's replacement name for NZIJ happened after an effective reverse takeover and brought echoes of the past. Widespread's directors replaced their NZIJ counterparts on December 15. They were Chris Castle, Jill Hatchwell and Linda Sanders (in alphabetical order, as opposed to the order named in the stock exchange daily memorandum).
Former Brierley Investments executive Castle was back in 1988 chief executive of investment company Charter Corporation. He was a director of five other listed companies: Arpac International (goats, and a Charter subsidiary after a takeover), Australis International (forward currency dealers, with Charter having 24.7% in 1988), Leverage Investment Corporation (placed in receivership in December 1987 at Charter's request), Premier Mining Securities and Spectrum Resources.
Charter went into voluntary receivership in late 1987 after failing to solve short-term liquidity problems. Creditors were paid out and Castle went private, with reputation intact.
Some associates were casualties of post-crash, pricked balloons. Hatchwell was a Charter director in 1987 and stuck with the private operation, having, in earlier days, been with Brierley Investments.
Sanders was a business editor of the (then) Evening Post and at various times a PR spin doctor, including for Telecom.
Market observers will be interested to see the performance of presumably wiser, even because only older, people almost a couple of decades on. Perhaps Widespread should have adopted the title "Phoenix" after effectively acquiring NZIJ.
The most bizarre (disgusting) news of the year was directors and executives of companies worldwide scrambling to show their purity regarding corporate governance and remuneration.
Those matters were covered extensively in this column during the year, but came again at Westpac Banking Corporation's annual meeting in Australia on December 11. It was told the bank had become virtuous and would stop granting directors' retiring allowances. So virtuous that the new regime would apply only to "non-executive directors appointed after July 2003."
"Past retirement allowance arrangements will continue for existing directors under the original terms of their appointment."
Many companies in New Zealand, Australia and other countries were similarly zealous and virtuous, as was the NZSX, but in all cases the rules were to apply in future.
The reason was obvious. No current director would approve curtailment of goodies, pleading contractual obligations with their companies. Equally, no director of a public company anywhere would be short of a dollar, otherwise they would be an unlikely appointment.
Directors would regain public creditability if occupiers of board seats voluntarily surrendered retirement entitlements. (There is nothing new in that view; I have propounded it since the concept of retirement allowances was first developed in New Zealand).
It was a bizarre year and would be more bizarre if it ended with directors giving shareholders a well-deserved Christmas present.
Yeah, did you see that porcine aviator and the red-suited fellow with the aviation reindeer?
Directors would regain public creditability if occupiers of board seats voluntarily surrendered retirement entitlements.
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