Wilson Neill shareholders demand inquiry

By KARYN SCHERER

Disgruntled shareholders of hospitality company Wilson Neill are turning up the heat on the company's board over the actions of its former executive director, Paul Hyslop.

Mr Hyslop resigned last week after the Herald revealed he was the man at the centre of a Serious Fraud Office investigation last year into the possible inside trading of Fletcher Challenge Paper shares.

He admitted in court he had been "motivated by greed," but has so far escaped prosecution because it is believed New Zealand's insider trading laws are inadequate.

At least two shareholders are now demanding the board investigate his trading in his own company's shares since he joined as a director in January.

According to share registry records, Mr Hyslop has embarked on a frenzy of trading. His Wilson Neill share registry account contains 28 pages so far this year, with 10 share transfers per page.

Auckland-based shareholder Ian Andrews, who is well-known to the board for his grillings at Wilson Neill's annual meetings, yesterday called on the company to examine whether any of the transactions might have been based on inside information. He has also asked the company to arrange an independent inquiry into the issue.

Although insider trading laws apply only to publicly listed companies, Mr Andrews is questioning whether it might be a breach of company policy or its statement of corporate governance.

"If there is nothing found, the investment community and shareholders can rest easy, but until an inquiry is complete, the trust which ought to rest easy with directors in running the company is seriously impaired," he said in a letter to Wilson Neill chairman Trevor Mason.

Meanwhile, another shareholder said he raised similar issues with the company in August. Albany investor Lance Pawley said the company ignored his letter. Yesterday, he said that he was well aware the company was not subject to the same rules as listed companies, but still found the lack of information provided quite discomforting.

"I bought them as a penny-dreadful punt ... I know the risks of trading it, but on the other hand I wouldn't mind if the [board] got on with the job they're supposed to be doing."

Mr Mason yesterday took a swipe at Mr Andrews, saying he was surprised the media had not "given up on news about him by now."

He said he had not had time to read the letter, and it was therefore "a little premature to comment."

Nor had he seen Mr Pawley's letter.

The Dunedin-based accountant, who is also a substantial shareholder in Wilson Neill, confirmed the board had accepted Mr Hyslop's resignation as executive director.

However, he appeared surprised to learn that Mr Hyslop had told the Herald he intended to stay on as an unpaid consultant until the company's next annual meeting in September, when he would offer himself for re-election.

Mr Mason initially denied that was the case, but then said it was an issue for the board to discuss at a meeting later this week.

"A number of matters will be discussed at a meeting later this week, but I can't comment [on that] at this stage."