Market regulators and listed dairy companies faced an unusual, tricky situation in the lead-up to this week's 1080 threat announcement.
Fonterra and Federated Farmers received letters from an anonymous activist four months ago that threatened to poison milk products with the pesticide.
But the dairy co-op, which operates an NZX-listed shareholders' fund, and Synlait Milk were able to disregard continuous disclosure rules that normally require material information to be immediately disclosed.
They both informed the market of the threat at 3.51pm on Tuesday afternoon, following the public announcement.
A trading halt on both stocks was lifted soon after.
The delayed disclosure was made possible by the NZX and Financial Markets Authority (FMA) deciding information surrounding the threat was being kept confidential and wasn't "sufficiently definite" to require earlier disclosure.
Synlait was informed of the threat early last month.
Listing rules for the shareholders' fund and NZX main board state that material information can be withheld if "a reasonable person would not expect the information to be disclosed" and the information is confidential and kept that way.
Issuers must also meet at least one of a number of additional requirements, including that the information is "insufficiently definite to warrant disclosure".
Important police and industry work, which needed to be kept under wraps, had been going on behind the scenes since the letters' arrival in November.
A reasonable person probably would consider the importance of the investigation - and the economic dangers posed by the threat - sufficient to waive the need for immediate disclosure by the two dairy companies.
However, it's unclear how the confidentiality requirement was met.
Defending the Government's decision to go public with the 1080 threat, Prime Minister John Key said "over 1000 people" knew about it before the public announcement.
Marco Marinkovich, founder of infant formula exporter KiwiMilk Nutrition, said he became aware of the threat three weeks ago and it was widely known about in the industry by that time.
Little impact
In the end, the poison threat didn't have a big impact on Fonterra Shareholders' Fund units or Synlait shares.
Both stocks closed down 5c - Synlait at $2.90 and the fund at $5.80 - on Tuesday.
An NZX spokeswoman said the release of "imprecise or insufficiently definite" information about the threat before Tuesday could have had an "unintended adverse impact" on the affected securities.
Synlait was informed of the 1080 threat early last month. Photo / Brett Walker
"As part of NZX's routine surveillance processes relating to price-sensitive announcements, trading ahead of [Tuesday's] announcements will be assessed in detail for any suspected market manipulation or insider trading," she said.
Units in the Fonterra fund closed steady at $5.80 last night while Synlait shares were down 4c at $2.85.
Prospectus improvements?
The prospectus for the forthcoming Fliway Group initial public offering (IPO) was the first to be registered since new securities legislation came into effect on December 1.
But the document may be disappointing for investors looking for the improvements promised under the Financial Markets Conduct Act.
The prospectus runs to 170 pages, while the accompanying investment statement comes in at 88 pages.
Fliway - which is looking to raise $27.3 to $44.5 million through the IPO - expects to list on the NZX on April 9.
The new legislation has introduced a simplified product disclosure statement (PDS) regime for investment offers.
With IPOs, the documents are limited to a maximum of 60 pages in length, with a key information summary no longer than four pages.
Issuers can offer products under the previous Securities Act disclosure regime until December 1, 2016.
Simone Robbers, the FMA's director of primary markets, said the regulator would like to see issuers move to the new regime as soon as possible. "We believe that equity issuers in particular should be using the new regime unless there is a good reason for them not to," Robbers said.
To be fair, both the Fliway investment statement and prospectus include a four-page, user-friendly section containing the crucial information about the offer.
And the risks section largely focuses on specific potential threats to Fliway's business, rather than a long list of general risks every company faces.
Tender risk
The Fliway offer documents give some insight into the importance to the firm of a small number of key customers.
According to the prospectus, contracts with three unnamed clients - which together accounted for 12.3 per cent of the firm's $81.5 million 2014 revenue - are scheduled to expire in 2015.
"Fliway is likely to have to participate in a competitive tender process in order to retain a number of those contracts," the document warned, adding that there were no guarantees the tender would be successful. "Even if it is successful, Fliway may have to agree to less favourable terms with the relevant customers."
Fliway - which is looking to raise $27.3 to $44.5 million through the IPO - expects to list on the NZX on April 9.
Brokers slug it out
Ex-Black Cap Gareth Hopkins starred for Craigs. Photo / Mark Mitchell
First NZ Capital and Craigs Investment Partners have taken World Cup fever to another level, with an inaugural cricket match between the two sharebrokers held last Friday.
First NZ proved victorious over Craigs, despite the latter firm having an ex-Black Cap - Gareth Hopkins, now an equity dealer - on its team.
The duel was held at Craigs executive chairman Neil Craig's private cricket ground at Matapihi in Tauranga, jokingly known as the MCG.
Craigs' batting line-up notched up a respectable 193 from 30 overs. But they were let down by their bowling attack and First NZ surpassed its competitor in the 28th over.
The top scorer was Craigs analyst Mo Singh, who notched up 51 not out. First NZ analyst Stephen Reid also reportedly pulled off an impressive batting performance.
Still, Craigs can be consoled by the fact it narrowly beat First NZ in the Business Herald's 2014 Brokers' Picks competition. Craigs' picks provided a total return of 39.6 per cent, just ahead of First NZ's 37.2 per cent.
