Bottoms up for South Island

Friday 15th December 2000

SOUTHERN DEALS

The boom in the rural economy was good news for the South Island. CHRIS HUTCHING rounds up the southern deals that counted this year

Pyne Gould hits the big time

One of the biggest deals for a southern company came right at the end of the year with Christchurch-based Pyne Gould Corporation announcing the near doubling of its financing division with the purchase of Auckland finance company Marac for $41 million and also the purchase of Dunedin-based Frontline Finance from John Gilks for $20 million.

The company's simultaneous bid for the remaining 49% of listed cash box South Eastern Utilities is unaffected by the latest takeovers.

Southern Capital's smart deal

Settlements from property sales allowed Southern Capital to repay a $10.8 million ANZ Bank loan this year. One of those settlements involved the instant resale of a North Canterbury farm, providing a $2.5 million profit.

Southern Capital's expert contacts in the Christchurch property scene allowed it to set up all the ducks in a row, with the property going from Landcorp to Ngai Tahu ($4 million) to Southern Capital ($4.5 million) to a syndicate of local authorities ($7 million).

Would-be deal of the year

The headline said, "$US563m Tekapo plan on track says developer," but the dream of Christchurch man Steve J Stinson looks like remaining just that. He was set to unveil an $US563 million initiative for the Tekapo area complete with international airport, alpine theme park and monorail. But all has gone quiet.

McKenzie District Council senior executives who met Mr Stinson are not expecting an application for a plan change in a hurry.

'Ouch!' of the year

The $3 million agreement by Christchurch businessmen Adrian Sisson and David Lyall to buy the nearly completed floating breakwater and associated assets of Lyttelton Marina from marina developer Mark Truscott was the least enduring deal of the year.

The two men sent a $100,000 deposit to the bank. But within 48 hours their expectations were sunk as one of the fiercest storms in recent memory swept across the region, smashing the partially built floating marina and boats tied to it.

Messrs Sisson and Lyall say the deal is off because the parties cannot fulfill the deal and they instructed their bank to cancel the cheque. Mr Truscott says the deal was signed and sealed. Now the parties are embroiled in a dispute about it.

Wine winners

The price of grape-growing land in Central Otago hit new heights with the sale of one of the country's prestigious small wineries, Felton Rd Wines at Bannockburn, said to have sold for $7 million. The best grape growing land in the area is now approaching prices at around $30,000/ha compared with Hawke's Bay's $25,000/ha.

Meanwhile, the South Island tribe Ngai Tahu has been unmasked as the mystery backer of about $10 million worth of vineyard purchases in Marlborough over the past 18 months.

Ngai Tahu is cash rich at the moment as it identifies investments to buy with the proceeds of its $250 million settlement with the Crown. Some of the money was used to buy Crown assets, including huge tracts of forestry land comprising 39,213ha in Otago and Southland which it sold to Rayonier in January for something approaching $40 million.

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