NZX CLOSE: NZ shares slip for 2nd day as floats loom, Kathmandu dips

Wednesday 18th November 2009

New Zealand shares fell for a second day, led by Sky Network Television and Fisher & Paykel Appliances, as investors prepare for an influx of share sales and a pick-up in corporate activity. Kathmandu Holdings slid back toward its IPO price after two days of trading.

The NZX 50 Index declined 3.11, or 0.1%, to 3128.40. Within the index, 21 stocks fell, 12 rose and 12 were unchanged. Turnover was $84.6 million.

Kathmandu declined 3.2% to $2.14 on the NZX, 1 cent above its initial public offering price.

Companies including milk processor Synlait Ltd, sweetener processor BioVittoria and property investor DNZ Property Group are preparing to go public this year.

Allied Farmers today agreed to an all-stock acquisition of Hanover Finance, valuing the target’s assets at $400 million.

“People believe the cycle over the next year or two will move in their favour,” said Angus Gluskie, who oversees about US$300 million at White Funds Management in Sydney. “Compared to six months ago we now have companies able to execute on acquisitions.”

Allied Farmers climbed 6.1% to 35 cents on news of the deal, which would dilute existing shareholders down to about 5%, and allow secured investors of Hanover and associate United Finance to exchange their securities for Allied shares.

Charlie’s Group, the juice company, gained 5.3% to 8 cents a day after chief executive Stefan Lepionka told shareholders that first-quarter trading was similar to a year earlier, with a pick-up in volumes expected over the summer, helping the juice maker achieve a full-year profit.

Contact Energy slipped 0.7% to $5.90 after the utility released figures showing it is continuing to shed electricity customers, though this was offset by a pick-up in LPG customers. Electricity customers fell by 500 in October and have declined 40,000 since October 2008.

Kiwi Income Property Group fell 1.9% to $1.02 and ING Property Trust dropped 1.3% to 78 cents.

Businesswire.co.nz

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