Brierley sells A$2.7 mln of GPG shares

Monday 1st September 2014

Veteran corporate raider Ron Brierley sold A$2.7 million of shares in Guinness Peat Group, the investment firm he founded in the early 1990s, and has raised more than $20 million since he started selling in late 2012.

Brierley sold the shares at 54 Australian cents apiece on Aug. 29, according to a notice to the stock exchange. At the current exchange rate, that's about $3.02 million, adding to the $17.73 he'd already raised.

That takes his running tally sold to 35 million shares since he started winding down his holding, and leaves him with 16.9 million shares, representing about 1.2 percent of the company's voting rights.

The shares closed at 63 cents on the NZX on Friday, and have gained 6.8 percent this year. The stock is rated an average 'hold' based on five analyst recommendations compiled by Reuters, with a median target price of 62 cents.

GPG was wrested from Brierley's control in 2011 when shareholders blocked a plan to split the company up along regional lines, and has since liquidated the bulk of its portfolio, leaving it with holding UK threadmaker Coats. The firm plans to rebrand as Coats once it settles outstanding pension liabilities in the UK, an issue that's taking longer than previously anticipated.

Brierley's sell down comes as his latest diversified investment vehicle, ASX-listed Mercantile Investments, supports the $36 million acquisition of Tower's life insurance business with a $4.75 million commitment. GPG was formerly a cornerstone investor in Tower.

Brierley seized control of Mercantile, then called India Equities Fund, in 2012 when shareholders agreed to a deal giving him 54 percent of the company and its chair in return for his stakes in Copper Strike, Trinity Group, ING Community Living Group, Australian Pharmaceutical Industries and Trojan Equity.

That's since been watered down to 46 percent after Mercantile completed a takeover of Murchison Metals via a scheme of arrangement, which let investors take either cash or shares.

Mercantile lifted its total financial assets to A$41.4 million in the 12 months ended June 30 from A$29.9 million a year earlier, generating a 20 percent gain in total income to A$7.53 million from gains on the sale of investments and revaluations of its assets.

The ASX-listed firm's shares last traded at 13.5 Australian cents, and have slipped 3.6 percent this year.

BusinessDesk.co.nz

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