KEY POINTS:
A subsidiary of Brent King's Viking Capital has acquired the investment advisory business of Dorchester Pacific just three days after it sold it to a third party.
Dorchester sold Equity Investment Advisers and Sharebrokers, MoneyOnline and New Zealand Investor magazine on Friday to former Spicers financial adviser Stephen Rogers for $1.375 million.
Yesterday the Investment Research Group, a wholly owned subsidiary of Viking Capital, said it had bought the business from Rogers at a higher price.
King, who helped found Dorchester and was its managing director until February 2006, also criticised Dorchester's sale process.
He said Viking Capital had expressed an interest in buying the advisory business in August when Dorchester first announced it would sell it, but had been excluded from the early stage of the sale process.
Viking Capital owns a 5.87 per cent shareholding in Dorchester and has been selling down its shareholding since August last year when it had around 10 per cent in the business.
King, who has recently been highly critical of the management of the business, said shareholders had lost out on Viking being blocked from the bidding process as Dorchester could have sold the business for more.
"It is once again disappointing for the long suffering Dorchester Pacific shareholders as poor quality decision making has seen them lose out as they could have sold the businesses at a higher price. We were happy to pay more [and we did]," he said.
He did not disclose how much IRG paid for the business.
But Dorchester Pacific chairman Barry Graham said Viking Capital's purchase of Equity Investment Advisers had come as a surprise.
He said the company had engaged independent advisers in the sale of the business arm and the company had narrowed it down to three serious bidders and dealt with the best offer.
"We were happy with the way they handled it," he added.
IRG provides information, analysis and advice on investments in New Zealand and Australia and has around $65 million in funds under management.
King said there were preliminary plans for how it would combine the IRG, Equity Investment Advisers and MoneyOnline businesses but it wanted to take a closer look before deciding the final structure and staffing.
Equity Investment Advisers currently has offices in Auckland and Tauranga. King said the new business would be based in Auckland.
