Second ban on trading in Air NZ

By FRAN O'SULLIVAN assistant editor

The Securities Commission has stepped up its inquiry into the trade in Air New Zealand shares after statements by Prime Minister Helen Clark and then by Brierley Investments chief executive Greg Terry twice caused trading to be halted.

The shares hit record lows on Monday after Helen Clark said statutory management was a "viable option", then rose after her subsequent "don't sell" message prompted the Stock Exchange to halt trading in them on Wednesday.

Yesterday, trading was halted for the second time after Mr Terry told a Singapore news conference that the shares would go to 60c "fairly quickly" if it was announced that Air NZ would continue with full support.

The commission's inquiry will investigate the price-sensitive statements and the pattern of trading in Air NZ shares.

Yesterday afternoon, Air NZ asked the exchange to suspend its shares until the market closes on Monday. If all goes to plan, a comprehensive announcement on the airline's future will be made that day - but if discussions are derailed the suspension will be extended until a recapitalisation plan is finalised.

Air NZ acting chairman Jim Farmer said last night that progress was still being made in talks with major shareholders, the Government and other relevant parties.

Dr Farmer acknowledged that the market was anxious for further information on the recapitalisation.

But he said the discussions "could themselves be prejudiced by premature, incomplete disclosure".

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