Stock takes: Expansion a Shore thing for Forsyth Barr

Takapuna has been a target for Forsyth Barr for some time. Photo / Jason Dorday

Despite the talk about more consolidation in the broker community it seems at least one firm is expanding.

Forsyth Barr is opening a new office on Auckland's North Shore. Forsyth Barr managing director Neil Paviour-Smith says the Takapuna office will be the sixth it has opened in the past two years, increasing its office numbers to 17.

"The North Shore is a place that we have wanted to be established in for quite some time," he said.

No doubt Forbar will be keen to tap into the well-heeled community. Debunking market speculation, Paviour-Smith says a potential tie-up with Macquarie is not on the cards.

"We have been going for 75 years as Forbar and we have no aspirations to change." Paviour-Smith admits the new clearing house being planned by the NZX could see more consolidation but says its intention is to be a party to that at this stage.

However, he did not rule out outsourcing the clearing functions to another party such as a bank clearing and settling specialist.

GALE FORCES

The share price of NZ Windfarms has faced a buffeting in the last week on the back of news of its capital raising and departure of chief executive Steve Cross.

The shares lost 7c alone last Friday after it announced plans to raise $31.4 million in an eight for three rights issue at 15c per right.

Since then it has fallen another 4c to hit a year low of 28c.

The company, which is 20 per cent owned by Vector, says the money will be used to fund expansion of its troubled Te Rere Hau project which it delayed last year to investigate faults with the turbines.

Despite previously signalling it would have to raise capital it seems the announcement was met with shock by some. News of a capital raising always tends to hit a company's share price as some investors bail out before they are asked to put more money in.

But one institutional investor has seen it as a buying opportunity.

Suncorp Metway group, whose local business is Tyndall Investment Management, has increased its stake from 8.2 per cent to 9.898 per cent.

Investors are to meet on April 8 to vote on allowing Vector to breach its 20 per cent stake without a full takeover in preparation for the capital raising and Vector potentially having to underwrite the deal.

Some shareholders are said to be nervous about allowing Vector to take a bigger stake but others have taken the view that there is little choice for the company which needs more capital. NZ Windfarms closed up 2c at 30c yesterday.

NUPLEX WILD FIRE

Resins and plastic-maker Nuplex's share price shot up to a year high on Thursday but it seems some of the propulsion may have been linked to confusion over a news item that said the company was about to make an announcement.

Sources say some believed the news was a fourth profit upgrade for the company which has made a strong recovery since its difficult capital raising last year.

In reality it turned out to be the acquisition of the ingredients business of Australasian company Med-Chem.

While the price paid for acquisition was not revealed, Stock Takes understands it was a relatively small buy estimated to be worth about $7 million.

Nuplex's share price rose 13c on the news to $3.45.

But the lack of price disclosure has annoyed some investors who believe it could set a precedent for larger acquisitions thought to be in the pipeline. Some fear Nuplex has not learned from its past mistakes when it got into trouble over debt after a failed acquisition attempt.

But Nuplex has been upbeat about the acquisition. Managing director John Hirst said earlier this week the acquisition would expand the company's footprint in the Australasian specialties market.

"The strategy is to grow in that direction as far as Australasia is concerned, so this [acquisition] is just being totally true to that strategy," he said.

ING NAME CHANGE

ANZ and ING staff were this week told what most of the rest of the market had been expecting for some time - that ING will be getting a rebrand and it won't be linked to the ANZ name.

It's no surprise that both ING and ANZ are keen to break away from any names associated with the frozen funds debacle in which disgruntled investors picketed ANZ branches up and down the country.

While the $400 million settlement took place last year, a decision by the Commerce Commission over whether it will take action on the way the two funds were sold is still to come. The commission is expected to report back in the next few weeks.

Labour MP Lianne Dalziel has also done her best to keep the issue live by launching a private members bill designed to stop the powers of the commission and other regulators from being undermined.

ING/ANZ Investors had to sign away their rights to take legal action when they agreed to the settlement.

Dalziel revealed details of the bill in Hastings last Friday with support from Act, the Maori Party and the Greens. ANZ bought the 51 per cent of ING it didn't already own in November last year and must find a new name for ING by November.

CLIMBING IN

The better-than-expected half-year result from outdoor clothing retailer Kathmandu last week has inspired some of the bigger institutional investors to up their stake in the company.

Both Challenger Financial Services and National Australia Bank filed substantial shareholder notices this week.

NAB, parent of New Zealand's BNZ, now owns 5.2 per cent while Challenger has increased its share from 5.01 per cent to 6.01 per cent.

Kathmandu's share price closed up 1c at $2.42 yesterday, slightly down from the $2.46 peak reached in the wake of its result.

THE LONGEST TIME

Market talk continues to swirl around the potential merger of Craigs Investment Partners and Deutsche Bank in a deal that seems to have been hanging around forever.

The general expectation is that it will go ahead - and an announcement could be made any day now - it's just the numbers that are being crunched.

But it's the numbers that are raising eyebrows around the market.

Stock Takes understands there is talk of a half stake in Craigs going for a price in the mid-to-late $30 millions.

That would be a huge windfall for the Craigs management team which paid just $3.8 million to buy back a half share of the business last year from ABN Amro.

REPORT CARD

The NZX's first report on its market supervision activities has revealed a surprisingly small number of complaints.

Last year the market operator processed 15,395 announcements and 226 waiver and ruling applications.

But just 33 complaints were made concerning listed issuers and brokers.

Only 23 matters were referred to the Securities Commission, of which 10 required no further action by the commission and a further 10 resulted in no action being taken by the commission. This left three open for investigation.

The NZX would not say what these cases referred to and yesterday said it was still waiting to hear back from the commission.