Pyne Gould expects to sell remaining NZ assets next year, chairman Mogridge says

Tuesday 10th December 2013

Pyne Gould Corp, the asset management firm controlled by George Kerr, expects to sell its remaining $4.8 million of assets still in New Zealand next year as it looks to quit this country and relocate to Guernsey.

Chairman Bryan Mogridge told shareholders in Auckland today the bulk of the company's $151.8 million of assets are located in Australia and the UK and it expects to sell the vestiges of its local portfolio next year, according to speech notes published on the NZX.

"Those remaining $4.8 million of assets are being actively marketed for sale and it is highly likely that PGC will have no assets remaining within New Zealand following the calendar year 2014," Mogridge said.

That would leave Pyne Gould with its core assets, which are a 31 percent stake in Kerr's Torchlight LP and a 27 percent stake in EPIC, which holds a 17.5 percent share of British motorway operator MOTO and manages the Torchlight partnership. Torchlight's investments include full ownership of property developer Residential Communities Ltd, a 29 percent stake in ASX-listed Lantern Hotel Group and an 11 percent holding in UK regional newspaper group Local Media.

Shareholders will today vote on whether to approve re-domiciling in Guernsey and shift its listing to the London Stock Exchange, something Mogridge said the company has been working towards for the past two years.

A London listing is expected to increase the company's profile with potential new investors who are familiar with its strategy targeting distressed assets, and broaden the shareholder base to improve share liquidity.

The company is seeking to deliver compound growth north of 15 percent over the medium to long term, meaning it will delivery "lumpy results" and has a policy of not providing market guidance, Mogridge said.

"However, we will continually outline our strategies and performance against those, but some years will be more bountiful than others which is the nature of the markets we do business in," he said.

Pyne Gould has bought back about 1.8 percent of the company's shares on issue at an average price of 43.11 cents per share as part of a buyback programme signalled last month, where it hopes to buy up to 5 percent.

The average buyback price is almost a 17 percent premium to the 37 cents per share offered by Australasian Equity Partners No 1 LP to take the company private last year.

AEP, owned by Kerr and Californian hedge fund Baker Street Capital, built a 76.77 percent stake during its takeover, and will have effectively crept up to 78.16 percent if it hasn't participated in the buyback.

The shares were unchanged at 45 cents yesterday, and have jumped 73 percent this year.

BusinessDesk.co.nz

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