Forum Archive Index - November 1999

["Wedde, John" <john.wedde@cit.ac.nz>]

Stewart,
Listed "shell" companies are usually companies that, although still listed
on the SE, are not engaged in much or any meaningful activity. The reason
for their original creation or existence is no longer  there. Another
company seeking listing may achieve this via the "backdoor" by taking over
the moribund "shell" , changing its name probably, its direction and
probably some or most of the directors. The old company has a new lease of
life, and the new company has achieved a listing without going through the
normal quite expensive and bureaucratic procedures it would normally need to
go through to get this.
Sometimes "shell"  companies may still have residual assets let over from
their old business which may be useful to the new company, or may be able to
be sold. Often listed "shells" may have as their major or only asset, cash,
which has resulted from already cashing up their old no longer useful
assets.
There have been a number of examples of this type of takeover this year on
the NZSE.

NZ Salmon became  Newcall
Habitat is about to become Ephone
Strathmore retains its old name but was taken over and given new direction
by parties close to Eric Watson
Iddison group became IT Capital
CBD became Southern Capital
NZ Petroleum became Eldercare - another Eric Watson move
These are a few.

I'm fascinated by these listings, and keeping a close eye on this type of
activity can be profitable if you get it right. This year in NZ if you'd
followed Eric around you could have done extremely well! I got bits of it
together. 
Cheers,

John Wedde BCA, MA, Senior Lecturer, Business Communication
Programme Leader, NZ Diploma in Business
Central Institute of Technology
Box 40 740 Upper Hutt, New Zealand
EMail: John.Wedde@cit.ac.nz
Phone: 5276397 EXT. 6747 Mobile 025843729

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                -----Original Message-----
                From:   Stewart Morse [mailto:aorang@voyager.co.nz]
                Sent:   Friday, 5 November 1999 12:53
                To:     sharechat@sharechat.co.nz
                Subject:        [sharechat] Listed Shells

                Can someone explain the workings of listed shell companies
as 
                rumoured that Aquaria 21 is proposing to use. Why is it used
and 
                why is there a shareholder benefit?
                Thanks,
                Stewart Morse

        
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