MARKET CLOSE: Stocks gain; Lion soars, Wrightson climbs

Monday 27th April 2009

New Zealand shares rose, with brewer Lion Nathan soaring on light volume after 46.1% owner Kirin Holdings offered to take over the company at a premium and PGG Wrightson gaining after settlement of its dispute with Silver Fern Farms.

The NZX 50 Index gained 7.99, or 0.3%, to 2664.37, the first gain in six sessions. Within the index, 18 stocks rose, 17 fell and 15 were unchanged. Turnover was $65.4 million.

Lion Nathan jumped 38% to $14.60 in New Zealand, where the Australian brewer’s shares are lightly traded. The ASX-listed stocks soared about 40% to A$11.63, shy of the A$12.22 a share offered by Kirin for the remaining shares. The offer includes a 72 cents-a-share fully-franked dividend, credits that New Zealand investors can’t access.

Wrightson climbed 4.2% to $1.25. The rural services company on Friday settled its dispute over a failed alliance with Silver Fern Farms for cash and shares amounting to about $42 million. Wrightson obtained what is effectively a $25 million loan from South Canterbury Finance, with the finance company holding the right to convert the debt to shares.

Air New Zealand dropped 2.7% to $1.08, tracking declines in airline stocks throughout Asia amid concern the outbreak of swine flu will deter people from travelling.

“If it is prolonged, it may inhibit people in wanting to travel on an airline,” said Alan Moore, who helps manage NZ$250 million at Milford Asset Management.

Qantas Airways fell 4.6% to A$1.89 on the ASX. Hong Kong’s Cathay Pacific Airways fell 8.4% to HK$8.38.

Telecom rose 1.5% to $2.63 after the biggest company on the NZX 50 said its XT Mobile Network will be launched on May 13, providing coverage to 97% of the country. The new network brings Telecom in line with the majority of the rest of the world and in step with rival Vodafone Group.

NZX, manager of the New Zealand stock exchange, rose 2.3% to $6.75 after posting a 40% surge in first-quarter profit as it lifted revenue while keeping operating costs in check.

“Over the next few years, NZX is well-placed to continue to deliver strong financial results,” chief executive Mark Weldon said. First-quarter results featured a 67% jump in capital raisings, mainly because of increased debt sales, which may not be repeated in the second quarter.

Pan Pacific Petroleum rose 2.5% to 41 cents after announcing a special dividend of 3 cents a share, or $23 million, reflecting revenue from the Tui oilfield.

Methven fell 8.9% to $1.02 and was the biggest decliner on the NZX 50. Pike River Coal fell 5.1% to 75 cents. Fisher & Paykel Appliances, which is still in talks with its banks to refinance its $80 million short-term facility maturing April 30, fell 2.2% to 44 cents.

Rubicon, the company specializing in tree crop research, was unchanged at 63 cents a share after directors recommended shareholders reject an offer for 10.83% of the shares at 70 cents apiece from funds associated with Knott Partners LP. The shares are worth $1.15 to $2.26 a share, according to an assessment by Grant Samuel, released by the company today.

Businesswire.co.nz

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