Sharemarket grants Feltex reporting waiver

The New Zealand stock exchange has granted troubled carpet maker Feltex a waiver from presenting its year end earnings report by today, as is required by listing rules.

The waiver comes as Feltex's bank ANZ considers a $51 million rescue bid for Feltex, headed by brothers Graeme and Craig Turner, principals of bedding company Sleepyhead.

Feltex today said constructive discussions were continuing with the ANZ bank and the Turners in relation to the Turner proposal and variants of it which would provide substantially the same outcome to shareholders.

It was hoped to make a further announcement today, or tomorrow morning.

NZX said it had agreed to grant Feltex the report waiver on the condition that Feltex release its preliminary results as soon as possible after they were available, following ANZ's decision and in any event on or before Monday.

The Turners will need support from the ANZ while new loan arrangements are put in place for Feltex, which owes at least $135 million but says it is trading profitably.

ANZ could also decide to continue to bankroll the company.

In its statement today, NZX said that under listing rules Feltex must make its preliminary earnings announcement not later than 75 days after the end of the financial year to which that report relates.

In Feltex's case the financial year ended on June 30, making today the final day for reporting the earnings.

Feltex said the accounting basis on which its financial year-end accounts should be prepared and audited could not be determined until the likely future of the company was resolved.

In the absence of the Turner offer or any other recapitalisation transaction proceeding, it was likely the financial year-end accounts would need to be prepared on a "break-up" accounting basis, Feltex said.

With a decision on Feltex's future expected by 11am tomorrow, the waiver sought would enable it to prepare its accounts and make the preliminary earnings announcement when its board had greater certainty about the company's direction.

Work needed to prepare accounts on a going concern basis and on the alternative break up basis was largely finished, but not audited.

Feltex believed it would be in a position to meet the NZX's extended deadline once a decision on its future was made.

- NZPA