Selwyn Cushing's clan behind Wakefield bid

Selwyn Cushing

The Cushing family is behind a stand in the market to buy a 10 per cent stake in the listed health group Wakefield Hospital.

David Cushing, son of Hawke's Bay millionaire Selwyn, did not want to discuss Friday's bid of $4.23 per share, but conceded yesterday "we may have an involvement".

The Cushings already own 7.37 per cent of Wakefield in the name of Selba Holdings and Nessock Custodians. It is the second-biggest stake after the AMP. Wakefield shares closed on Friday up 2c at $3.70.

The company has 9.15 million shares on issue and a market capitalisation of $33.9 million.

The stand in the market, made through ABN Amro Craigs, is conditional on the bidder getting 5 per cent. It will close tomorrow evening.

Cushing said the family trust was a long-term shareholder and "supportive of the company".

"It's going in the right direction which is pleasing, and the result put out [on Friday] was certainly positive."

Wakefield reacted to Friday's bid by bringing forward the announcement of its full-year results.

It posted unaudited accounts with the NZX just minutes after the stand opened, showing a 22 per cent rise in net after-tax profit to $2.9 million for the year ended March 31.

An analyst said the company's swift response was commendable in ensuring a fully-informed market.

Wakefield, which listed in 2001, was criticised by the Securities Commission the following year for presenting misleading initial public offering documents, which did not adequately describe potential risks or show the assumptions behind some of the financial statements.

The company's shares had been issued at $2.50 each.

The prospectus forecast a March year profit of $1.9 million but in November 2001 the company slashed full-year expectations to less than $1 million, after Wellington's health board decided to stop subcontracting cardiac surgery.

The prospectus assumed the contract would continue.

At the time of the commission's investigation the shares had sunk to $1.40.

On Friday the company said net profit before tax had increased 58 per cent to $4.7 million.

Group revenues of $43.5 million were up 16 per cent. The final dividend would be 8c a share, despite an investment of $5.7 million in facilities and equipment during the year.

An analyst said shareholders since listing had received a gross return of 24 per cent on their investment, inclusive of dividends.

The Cushings could have decided to increase their stake after seeing Australian funds buying into the health sector across the Tasman, he said.

"As we have seen in other plays, when they run out of opportunities in Australia they start looking at New Zealand."

The Cushings have featured in sharemarket plays around companies including plastics maker Vertex and rural services provider Wrightson.

Selwyn Cushing joined the board of Wrightson in February.

That was after he and his family interests sold their 19.9 per cent stake in Hawke's Bay rural services firm Williams & Kettle to Wrightson, ensuring the success of Wrightson's takeover bid.

Cushing accumulated a 7.6 per cent stake in Vertex after the plastics' company's first profit warning, before selling at a profit to Christchurch businessman George Gould in February 2003.

- additional reporting staff reporter, NZPA