Stocks to watch: ANZ Bank, Pyne Gould, PPP, Telecom

Tuesday 29th September 2009

The following stocks may be active on the New Zealand exchange after developments since the close of trading yesterday.

Themes of the day: The government today announced plans to overhaul the Telecommunications Service Obligations levy that phone companies pay Telecom toward the cost of unprofitable services. Shares gained on Wall Street after companies including Xerox announced takeover deals.

ANZ Bank (ANZ): The lender climbed 6.1% to $29.70 yesterday, leading the index higher. Several analysts raised their price targets for the shares after the lender’s announcement on Friday that it agreed to pay A$1.76 billion for ING’s 51% stake in their Australia and New Zealand wealth management and life insurance joint venture. The deal lifts its wealth management assets to a scale to compete with rivals.

Mowbray Collectables (MOW): The stamp and book auctioneer said its 20% owned Australian associate First East Auction Holdings, has agreed to acquire Sotheby’s Australia. The shares jumped 11% to $1 yesterday.

Pan Pacific Petroleum (PPP): The oil company part-owned by New Zealand Oil & Gas, had its shares halted from trading pending an announcement. In December, NZOG bought 15 percent of its partner in the Tui oilfield. The shares fell 4 cents to 69 cents on Friday.

Pike River Coal (PRC): The mining company yesterday pointed to analyst predictions that the price of hard coking coal will reach US$200 a tonne next year, which is likely to drive up contract prices, the Press reported. US dollar-based contract prices are set once a year in talks between Australian producers and customers in Japan. The shares rose 1 cent to 99 cents yesterday.

Pyne Gould Corp. (PGC): The investment and finance group sunk 14% to a record low close of 70 cents yesterday. The company is raising as much as $270 million selling shares at 40 cents apiece, seeking to restore a balance sheet eroded by write-downs on property loans.

Rakon (RAK): The manufacturer of components for navigation systems is rated ‘outperform’ by First NZ Capital analyst Jason Familton, according to the ShareChat website. Rakon is raising $45 million via a placement to institutions, which was underwritten at $1.10 a share but sold at $1.15. The company is also offering $20 million under a Share Purchase Plan at the lower of $1.15 or 2.5% below the average end-of-day market price of Rakon shares during the five business days ending September 29. Familton said the SPP was “a compelling entry point for investors." The shares rose 5 cents to $1.25 yesterday.

Telecom Corp. (TEL): Communications Minister Steven Joyce today said the government plans to fund its rural broadband initiative via direct government funding and reform of the Telecommunications Service Obligations levy, which other carriers currently pay Telecom to meet the cost of unprofitable lines the government deems important. The stock rose 3 cents to $2.65 yesterday.

Businesswire.co.nz

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