Kingfish closes in on prey

Duncan Bridgeman

Friday 26th March 2004

Fisher Funds Management is giving itself three months to invest the bulk of its Kingfish share float capital following strong support from investors.

The Kingfish offer, seeking up to $75 million from investors, closes today, with the company expecting to list on the stock exchange next week.

Brokers said investors quickly snapped up the first $50 million and institutions were accepting over-subscriptions during the past two weeks.

Fisher Fund's Carmel Fisher said anything above the $50 million mark was a bonus.

"We're comfortable with what we've got. It has been a well-received issue."

Kingfish would look to invest in small local companies with a market capitalisation of up to $450 million.

Its presence is likely to push the price of some illiquid stocks upward leaving it vulnerable to exiting at a significant discount.

Fisher said she was mindful of signalling any intentions to the market and Kingfish would not be in a great hurry to invest.

"We have put some feelers out and earmarked some stock and we're pretty comfortable that we're going to be able to invest a large chunk of it.

"[But] we don't want to be obviously out there and trying to buy in the first month ... we've given ourselves three months to invest the bulk of it."

The Kingfish prospectus said the company expected to be a long-term holder, investing in 15-25 stocks at a time.

It has an opinion that sales of its core holdings would be exempt from tax but no binding rule from Inland Revenue.

About 85% of assets were expected to be held in a subsidiary called Kingfish Holdings.

The other 15% would be held in another subsidiary, Kingfish Nursery, which would focus on fledgling stocks.

Fisher Funds manages about $200 million for investors through a series of managed funds.

Its speciality is in investing in companies outside the top 10 and has a focus on growth rather than value.

The Kingfish float comes at a popular time for investment companies with strong performances from the likes of Guinness Peat Group and Infratil.

A new firm, Milford Asset Management, has just been set up to service high net-worth interests, charitable trusts and select institutional investors.

Among its directors are the former head of Salomon Smith Barney, Neville Todd, and a former guardian of New Zealand Superannuation, Brian Gaynor.

The sharebroking community is expecting some sort of action from Milford in the near future, possible a capital raising of its own.

The Kingfish board consists of independent directors Rob Challinor, Annabel Cotton, Ian Hendry and Ms Fisher.

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