Carter Holt puts listing plan on hold, citing uncertain earnings outlook

Tuesday 9th June 2015

Carter Holt Harvey Group put on hold its plan to sell shares in an initial public offering and list the shares on the New Zealand and Australian stock exchanges, citing an uncertain earnings outlook.

Auckland based Carter Holt, owned by billionaire Graeme Hart's Rank Group, said last month it planned to sell shares in the company with Rank to retain a significant holding.

Rank paid $3.31 billion for Carter Holt in 2006, and has since sold off the company's forestry and farm land and its pulp and paper unit, leaving a smaller business focused on wood products and building supplies. The IPO, which had been slated for the middle of the year, has been put on hold following changes in market conditions in recent weeks which introduced a level of uncertainty to the earnings outlook of the Australian timber business, the company said today.

"The new CHH board, in conjunction with the group's advisers, determined they were unable to finalise the forecasts in the IPO offer document given the necessary level of confidence required as to the forecasts’ accuracy and probability of being achieved," the company said. "Accordingly, until these circumstances become clearer, the IPO of CHH has been put on hold."

The decision had the full support of Rank Group, it said.

The float delay comes amid media reports Australian company Wesfarmers, which owns the Bunnings Warehouse chain, may be considering the purchase of the company's distribution arm, Carter Holt Harvey Building Supplies.

The Australian newspaper said the Carter Holt listing had been placed on hold while talks continued with Wesfarmers. The IPO would now happen in the third or fourth quarter of this year should a deal with Wesfarmers fail to eventuate, the paper said, citing sources it didn't name.

Carter's building supplies unit is one of three divisions in the company, which also includes Woodproducts Australia and Woodproducts New Zealand, the paper said.

Rank's Hart had previously ruled out breaking up the business, the paper said.

BusinessDesk.co.nz

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