New Zealand Finance Holdings (NZF) said it would expect Liberty Financial to bid for a seat on the Mike Pero Mortgages (MPM) board now it had obtained a 10.1 per cent stake.
NZF is due to launch a formal takeover at $1.05 per share for Mike Pero on February 14
but on Friday Liberty obtained its blocking stake in a lightening raid at up to $1.10 per share.
"Our bid is continuing... Our bid wasn't conditional on obtaining 90 per cent," NZF's John Callaghan said.
NZF bought a 54 per cent stake in MPM from Gould Holdings for 82c per share in November, sparking a full takeover offer that netted just one per cent of the company. It revealed details of the fresh bid on January 31.
Independent advisers had valued MPM at between 96c and $1.09.
Mr Callaghan said NZF had close associations with Liberty and was "looking forward to working with them in the future".
Established in 1997, Liberty describes itself as Australia's market leader for non conforming home and motor loans. Its speciality is lending to borrowers who did not meet the rules of traditional lenders. It was active in New Zealand.
Liberty marketing manager Andrew Dingian said the stake would allow it work closer with both NZF and MPM. Liberty is the biggest provider of finance to both NZF and MPM.
He said the investment had been made because Liberty was positive about the industry.
"We regularly invest in our business partners and this is likely to accelerate," he told The Dominion.
NZF believes the investment in MPM was made to give it leverage with its products.
Mr Callaghan said Liberty's move was "not a total bolt out of the blue".
He wouldn't comment further until NZF and Liberty had talked.
"I believe that anybody that has $3 million invested in a company would look to acquire a board seat.
"With an entity the size of Liberty it's a positive statement to be able to offer their input."
MPM shares were issued at $1 in May 2004, but dropped to a low of 55c last April as banks stopped paying commissions on Mike Pero-brokered mortgages. They were trading at $1.05 yesterday.
MPM expected to post a net profit of $1.9 million for the 2006 financial year, up from the $1.6 million posted this year.
- NZPA
New Zealand Finance Holdings (NZF) said it would expect Liberty Financial to bid for a seat on the Mike Pero Mortgages (MPM) board now it had obtained a 10.1 per cent stake.
NZF is due to launch a formal takeover at $1.05 per share for Mike Pero on February 14
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