Would be bank to list on market today

Jeff Greenslade, chief executive of Marac / PGC.Photo / Doug Sherring

New Zealand's first new equity listing in six months will debut on the sharemarket today but trading will be limited because 72 per cent of the shares are still tied up with one owner.

Building Society Holdings, a new company established through combining Pyne Gould Corporation's Marac Finance, CBS Canterbury and Southern Cross Building Society, will be the first listing since property company DNZ hit the market last August.

The only other listing last year was a small one by candle retailer Ecoya.

Pyne Gould Corporation (PGC) chief executive Jeff Greenslade, who will move to head the new company, said it did not have a set idea on how much the shares would begin trading at. "We expect there is going to be interest in the shares because this is a unique proposition."

In its combined state the company will be one of the largest remaining finance companies in New Zealand with $2.2 billion of assets, but it also aims to get a banking licence. If it gets the licence it would be the smallest of New Zealand's banks but one of only four that are New Zealand owned.

The company has a net tangible asset backing of $265 million and 300 million shares equating to 88c a share. But only 28 per cent of the shares can be traded as the remaining 72 per cent is still owned by PGC.

In November PGC said if the deal to combine the companies went ahead it would distribute most of its stake in Building Society Holdings to PGC shareholders as well as a small placement to institutional investors.

At the time the company said it intended to "implement the distribution as soon as practicable following the proposed listing". But in a statement last Thursday PGC said the distribution would be scheduled for the first half of 2011.

Greenslade denied there was any delay and said it was still proceeding with the distribution but it had not yet decided how much of the 72 per cent would go to shareholders and how much would be placed.

"It's really a legal process we have to go through. There are no roadblocks or obstacles - it's just a process we have to go through."

Greenslade said the breakdown between the placement and share transfer depended on the capital lending within the group.

PGC has promised to sell its 18.3 per cent stake in PGG Wrightson to Agria Corporation but will not know exactly how much of its stake will be included in the partial takeover until it closes on April 15. The take-up will be adjusted proportionally depending on how many other Wrightson investors also take up the offer.

But Greenslade said regardless of how much of the 18.3 per cent was sold to Agria it would be disposing of the entire stake in Wrightson.

"We will be looking to divest or place all of it one way or another," he said.

If it sells the entire stake to Agria it would net around $83 million.

The transfer of Marac and sale of its PGG Wrightson stake leaves PGC with just its Perpetual asset management and trustee business, which includes its private equity fund Torchlight.

Some have questioned whether the company will remain listed as it is likely to fall out of the NZX-50 once it transfers the shares in Building Society Holdings to investors.

Greenslade said the intention was to remain listed but it was undergoing a strategic review and considering a "number of options."