Companies Office and Charities Services’ records have revealed the 68 family members who are shareholders of the 144-year-old business which combined with an associated charity has $120 million in assets. What does the future hold?
Sixty-eight people, family and charitable trust entities own the shares in the trading company of the 144-year-old Auckland retailer Smith & Caughey’s, which is closing next year.
The Companies Office lists all 68 in documents annually filed over the years as part of compliance because Smith & Caughey Holdings has more than 10 shareholders.
Tony Caughey, Smith & Caughey’s chairman, acknowledges this matter-of-factly: “It’s all public information.”
If as planned the stores shut next year, the shareholders could be in for a windfall from the Queen St and Newmarket properties, valued by Auckland Council at $53.5 million.
Caughey: “We made the decision to consult with staff to wind up the retail operation. We have not addressed what would happen to those buildings. That’s a property decision we will look at once we have been through the consultation process.”
The largest - but not the majority - Smith & Caughey Holdings shareholder is the philanthropic entity called the Marianne Caughey Smith-Preston Memorial Rest Homes Trust, known more succinctly as the Caughey Preston Trust Board, named after the founder.
In 2020, then-trust chairman Andrew Caughey (Marinne Caughey Preson’s great-nephew) announced that the trust would sell its 3.1ha Remuera Caughey Preston rest home property, then valued at $100m by the council.
It ended up being sold to a businessman originally from China for $66.5m, according to the trust’s financial accounts.
The trust owns 48.02 per cent of Smith & Caughey Holdings. So nearly half the business is controlled by that charitable endeavour, established by Marianne Caughey Preston, born in Ireland in 1851, “a devout Christian who, in Ireland, New York and eventually Auckland, committed her life to charitable acts” according to a High Court decision last decade.
The $66.5m was recorded in the trust’s annual Charities Register accounts for the year to September 30, 2022 and listed as “other revenue”.
What about other assets owned by Smith & Caughey Holdings? If the Queen St and Newmarket buildings were sold the money could be expected to be paid to shareholders, but nothing was said about the properties in last month’s closure announcement nor the trust’s future.
“Cousins,” is how those many people are described, living here, in Australia and the United States.
Tony Caughey says the shareholders are fourth and sometimes fifth-generation cousins. Of the top 20 shareholders, he said Richard Caughey, Sarah Smale and Richard King had all recently passed away.
Last month, Caughey recalled his direct family involvement.
“My father [William aka Bill] started in the business when he was 19 and stepped down as a director when he was 90 after 71 years,” Caughey said.
“He was chairman in his mid-80s and devoted his life to the business as did his father’s generation and the generation before that. So, there is a big issue of family loyalty and history and it’s probably one of the reasons why we tried so hard over the last couple of years to find a way to try and keep the doors open,” Caughey said last month.
Now, seventh-generation descendants were connected to the business.
How did the shares get divvied up?
“If you had a lot of siblings when the shares were handed down, you got a smaller number of shares. If you had fewer siblings, then you got more shares.”
The decision to close the stores was made by the board, Caughey said.
Smith & Caughey board members include Epsom’s Peter John Alexander, an independent director who doesn’t own shares in the family business.
St Heliers’ Matthew Andrew Lovelace Caughey, Missions Bay’s Philip Brian Ruxton Caughey and William Anthony Caughey, Epsom’s John Nicolas Elliott, Remuera’s Michael Howell Holloway and Dunedin’s Katherine Iris Milne are fellow directors.
There are so many shareholders after four to five generations that they could not all fit into the Smith & Caughey’s Queen St boardroom where they once met for AGMs.
“When you get down to five generations from the founder, you get a wide range of interests spread across a lot of different fields. In the old days I think decisions used to be made around the family dining table and that was that. But we’ve had a lot of Zoom meetings and those sorts of things to try and keep people on the same page,” Caughey said last month.
“The families grow and evolve and I think it becomes increasingly harder to keep a singular sense of purpose when you have that diversity after five generations.”
In 2018, the trust went to the High Court at Auckland to seek changes to the trust.
“The endowment comprised most of Marianne’s estate and was valued at around £325,000 at the time of settlement (approximately $40 million when adjusted for inflation today). It included extensive property holdings, cash in excess of £20,000 and a large shareholding in Smith & Caughey’s,” wrote Justice Sally Fitzgerald in her November 20, 2018 decision.
The aged care hospital had opened in 1950 and provided accommodation, board and lodging for aged and impecunious women, proving so popular that it soon expanded, Government grants being made for extensions, the court decision noted.
But by last decade, there was an oversupply of residential aged care facilities “and the trust’s dated facilities simply cannot cope”.
The trust wanted to use the money for “owning and/or operating residential or non-residential rest home and/or geriatric hospital facilities to assist and provide for women and men who are aged and/or infirm and/or impecunious, irrespective of religious beliefs”.
It started making losses: $1.1m in 2014, then a $3.76m loss by 2016. “The trust does not operate a model that would maximise profits, rather it seeks to meet the purposes of the trust”.
It got to the point where the family decided the hospital could not continue and the court’s involvement was required. So that 2018 court ruling allowed the property to be sold and for the trust to keep the sale proceeds.
The judge wrote: “Obviously the proceeds of any sale must be directed to the trust’s purpose”.
The $66.5m has remained within the trust, which in 2023 declared total assets of $117.3m.
Celia Caughey, Caughey Preston Trust chairperson, explained what is happening with that entity.
The trust is in the planning process to build a safe community of new homes to rent, with communal activity spaces, garden and appropriate support, for example trauma informed care, she said.
This will be for women who are homeless and have suffered trauma or abuse, “providing a safe haven and stability to recover and find their feet. It is a gap that has been identified after detailed consultation with social service providers working in the space of women’s homelessness, and design plans will incorporate the views of many of these women themselves. We are currently exploring a number of sites, so cannot be more specific about where this will happen,” Caughey said.
The founder had helped establish the forerunner of the Methodist Mission, now Lifewise.
She left legacies in her will to provide homes for women who were aged, infirm or impecunious and gifted shares in Smith & Caughey to the trust, “but few customers knew that some of the profits from their purchases were going towards care for the elderly,” Caughey explained.
Whatever ends up happening to Smith & Caughey’s, the trust will continue the founder’s legacy with ongoing care for vulnerable women in our city, Caughey said.
A South Island retailer, owned by some of the 68, remains a force in the south. Blackwell’s Department Store is a family-owned operation in a new building, built post-Canterbury earthquakes, in Kaiapoi.
That retailer was founded in 1871, well before Smith & Caughey’s in the 1880s. The Blackwell and Smith & Caughey’s shareholders are partly the same.
Andrew Blackwell is a director of the business. He is also a 0.57 per cent Smith & Caughey Holdings shareholder. And whereas the Auckland operations are due to shut, the southern outpost remains in hearty shape.
“Having this holding goes way back. My grandmother was Jean Caughey and there’s a double connection because my grandfather’s sister also married one of the Caugheys. It’s quite a family connection and history.”
He is sorry to hear of planned Auckland closures “not only the store but the family has a proud history not only in the retail world but also with a lot of the charitable and welfare groups”.
Blackwell’s is not breaking sales records but is trading well considering the economic times, he said.
“I’ve been involved here for over 40 years and this is one of the toughest periods right now, apart from the earthquakes trying very hard to take us out,” Andrew Blackwell said.
The Caughey Preston Trust Board 49,942,149 shares 48.02 per cent, D M Stewart 2,784,458 shares 2.68 per cent, R A Caughey 1,349,597 1.30 per cent, R S King 1,012,296 0.97 per cent, P G King 1,012,296 0.97 per cent, R M King 1,012,296 0.97 per cent, W G Caughey Trust 2 674,274 0.65 per cent, D M Ewen 682,918 0.66 per cent, P A Grayson 1,053,804 1.01 per cent, J M Stewart 77,568 0.07 per cent, D H Stewart 77,523 0.07 per cent, H A Stewart 77,568 0.07 per cent, G A H Mclean 982,638 0.94 per cent, M H Evans 982,639 0.94 per cent, J F Forrester 982,639 0.94 per cent, J L E Caughey 754,770 0.73 per cent, M C Colwell 1,230,826 1.18 per cent, P J E Petersen 754,239 0.73 per cent, S E E Smale 1,231,159 1.18 per cent, Petersen Family Trust 476,056 0.46 per cent, A M Loos 1,953 0.00 per cent, K I Milne 1,953 0.00 per cent, M A L Caughey 300,233 0.29 per cent, R K A McQueen 300,233 0.29 per cent, P A Springall 1,494,310 1.44 per cent, H W A Cameron 1,494,310 1.44 per cent, P R Cameron 1,494,311 1.44 per cent, J L E Caughey Family Trust 476,388 0.46 per cent, PD & HE Milne Family Trust 1,213,208 1.17 per cent, N E Caughey 10,111 0.01 per cent, S M Blackwell 589,807 0.57 per cent, A W Blackwell 589,808 0.57 per cent, M H Blackwell 589,600 0.57 per cent, E H Wallace 589,808 0.57 per cent, R J Whyte 589,806 0.57 per cent, P B R Caughey 1,007,308 0.97 per cent, J A Caughey 1,007,307 0.97 per cent, E M Caughey 1,006,603 0.97 per cent, A S C Trust 1,289,684 1.24 per cent, M & S Cauughey Family Trust 541,503 0.52 per cent, Celia M Caughey Trust 541,503 0.52 per cent, Couper Family Trust 541,122 0.52 per cent, The Washerline Trust 551,763 0.53 per cent, Renown Trust 1,230,295 1.18 per cent, The Anna Yates Family Trust 511,943 0.49 per cent, Rodnie Finlay Mingaye 1,395,191 1.34 per cent, C M Dixon 2,305,367 2.22 per cent, The Martin Caughey Family Trust 1,507,094 1.45 per cent, The Christine Caughey Trust 1,507,094 1.45 per cent,The D M Ewen Trust 370,149 0.36 per cent, The Rodnie Mingaye Trust 511,944 0.49 per cent, Lisa Hamilton Olive Caughey 499,435 0.48 per cent, Jane Parore 499,435 0.48 per cent, Katrina Hamilton Collard 499,435 0.48 per cent, Georgina Haldane 499,435 0.48 per cent, Anna Mary Elizabeth Yates 1,395,191 1.34 per cent, Terence Roderick Cornelius 10,259 0.01 per cent, Eva Naomi Lovelace Caughey 300,000 0.29 per cent, The Matthew Caughey Inheritance Trust 1,000,000 0.96 per cent, The Rachel McQueen Inheritance Trust 1,000,000 0.96 per cent, The Andrew Brown Family Trust 2,303,746 2.22 per cent, Sarah Kathleen Gerard 491,669 0.47 per cent, Judith Jean Holland 491,668 0.47 per cent, Jennifer Helen Sefton 491,668 0.47 per cent, Jane Pauline Sargent 491,668 0.47 per cent, Margaret Anne Goldstein 491,668 0.47 per cent, Robert Hugh Poole 491,668 0.47 per cent, W G Caughey Estate 329,633 0.32 per cent. Shares on issue total 104 million.
So why such a large shareholding in the hands of Hawkes Bay’s Diane Stewart with 2.68 per cent? She is the daughter of one of the sons of the founders hence her holdings exceed that of her relatives. It’s more where she sits in the generation line.
Anne Gibson has been the Herald’s property editor for 24 years, has won many awards, written books and covered property extensively here and overseas.
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