NZX unveils one-for-five rights issue in bid to raise $20.55m

Sharemarket operator NZX has released details of the $20.55 million rights issue it intends to use to fund a series of recently announced acquisitions.

However, its offer for a controlling stake in Australian second-tier market operator NSX may fall over next week when shareholders vote on whether to dump or retain the existing board with which NZX has been negotiating.

NZX yesterday released the prospectus for the one-for-five rights issue with the new shares being offered at $4 each. The cash raised is to help ensure NZX "is well capitalised to take advantage of growth and acquisition opportunities".

NZX has announced its intention to buy energy and related assets of the electricity spot market operator M-co, agricultural media publisher Country-Wide Publications, and a 50.1 per cent stake in NSX.

NZX's bid for NSX is seen as somewhat opportunistic coming as the underperforming holder of two Australian market licences is riven by a battle for boardroom domination.

The company will hold a meeting on either next Wednesday or Thursday next week to vote on whether to remove the board and elect new directors. NSX's present board has recommended NZX's offer to the company's shareholders.

Two of the largest shareholders, Sir Ron Brierley's Guinness Peat Group and another Australian market veteran, Brian Price, do not regard NZX's offer favourably.

NZX's offer will also require 75 per cent shareholder approval for an amendment to the company's constitution to remove a 15 per cent shareholding cap.

NZX said it was confident at least one of the three proposed acquisitions it is working on would proceed but if not "the proceeds of the rights issue may be used for the general corporate purposes of NZX including funding other initiatives".

NZX shares closed unchanged at $8.25 yesterday.