SOE policy foes lack 'intellectual honesty'

Andrew Harmos. Photo / Mark Mitchell

NZX chairman Andrew Harmos has called for "intellectual honesty" from opponents of the Government's proposed mixed-ownership model for state-owned enterprises.

The policy would offer investment options to savers and allow SOEs to have access to capital for growth from shareholders while the Government retained control, Harmos told the NZX annual meeting yesterday.

"If only opponents of this could have the intellectual honesty to recognise that it is a policy that has no losers," he said. "Emotive terms such as 'asset sell-off' are not accurate and mischievous."

He said NZX had performed strongly last year and was halfway through an even stronger 2011.

The domestic macro environment was as favourable to NZX as he could remember it being, Harmos said.

Business development and major capital initiatives of the past few years, including launches of a clearing house and a dairy derivatives platform, were delivering cash flows and earnings growth.

Harmos took issue with companies that took "an unnecessary swipe" at either NZX or New Zealand's capital markets when deciding to list on overseas markets.

He said investors bought quality companies wherever they were listed. Australian investors would buy quality New Zealand companies on NZX, and they would not buy poor quality companies just because they were listed on the ASX.

"Small to medium listed companies that are relevant to investors and analysts here are less likely to be relevant in the larger pool that is Australia and no more likely to enjoy research coverage or sustained, if any, attention," Harmos said.

"It makes sense to have a listing where a company's investors are, where its business is primarily located, where its brands are recognised and importantly, where it's relevant to the local community,"
he said.

- NZPA