Bumper share issue for financier

The latest share issue of South Canterbury Finance has closed oversubscribed.

The company set out to raise at least $40 million through the issue of perpetual preference shares with scope for another $15 million in oversubscriptions.

South Canterbury is controlled by Timaru millionaire philanthropist Allan Hubbard and has returned a profit and paid dividends to investors every year for 70 years.

Chief executive Lachie McLeod said the offer had closed oversubscribed with 2400 investors from around the country contributing the $55 million.

South Canterbury has had a bumper few years and net profits after tax were up 35 per cent to $19.56 million in the year to June 30, 2004. Profits have almost quadrupled in the past four years.

In the year to June 30, 2004, the company's revenue was ahead 19 per cent to $114.6 million. It had assets of $825.1 million and 25,000 loans worth more than $605.3 million.

"We always thought we were going to get it (the $55 million) because of the good results over the last couple of years," McLeod said.

"It's a broad base of investors from around the country from young to old." The shares pay an initial gross dividend of 10.25 per cent a year.

The Timaru business has branches around the country and its lending activities range from hire purchase to farm equipment sales and mortgages.

McLeod said South Canterbury had performed ahead of budget in the six months to the end of December.

He was not making any firm predictions about the New Year but did see the market getting softer.

The $55 million would be used to shore up South Canterbury's equity and explore expansion opportunities.

South Canterbury is owned by the Southbury Group, which in turn is owned by Hubbard.

In August, he bought a 23 per cent interest in Southbury from business partner Humphry Rolleston.

South Canterbury was founded in 1926 and, apart from two years during the Depression, has always been profitable.

- NZPA