Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search

 


Late raid on GPG shares pushes price to 2 ½-year high

Late raid on Guinness Peat shares pushes price to 2 ½-year high

By Suze Metherell

Jan. 17 (BusinessDesk) – Shares of Guinness Peat Group, the cash rich owner of a thread-making business that’s attracted investors including George Soros, have jumped to a 2 ½-year high after someone scooped up 1 percent of the company.

The shares climbed as high as 64 cents yesterday after an investor, likely to be an offshore fund, bought 19.7 million shares just before the close of trading. The stock traded at 63 cents today and has gained 7.6 percent so far this year.

GPG has about 404 million pounds of cash after selling its investment portfolio. It aims to return capital to shareholders and rebrand as its sole remaining asset, UK-based threadmaker Coats, though any return is on hold until it resolves a dispute with the UK’s pension regulator. Its pension liabilities will reduce as global interest rates begin to rise, closing the gap on rates used to benchmark those funds.

“Someone paid a reasonable premium to get that stock,” said James Lindsay, portfolio manager at Tyndall Investment Management. “The pension scheme did hurt them, but if you were to take a longer term view about UK interest rates normalising, it would help reduce those pension rates.”

Soros is among offshore investors in GPG, having bought an 8 percent stake in the company last year. Others include US bank JPMorgan and American fund manager Invesco.

In a statement made by the GPG chairman to the NZX in December the board expressed uncertainty about when the dispute may be resolved.

“The GPG board is deeply concerned that despite the enormous cost and management effort which the regulatory intervention is imposing on both GPG and Coats, we are still not close to a conclusion of these matters,” said the statement.

Shortly before Christmas the regulator delivered a warning to the company that its pension funds were insufficiently funded, however whether this will result in any further ‘financial support direction’ for the pension plans is not yet decided.

(BusinessDesk)

© Scoop Media

 
 
 
 
 
Business Headlines | Sci-Tech Headlines

 

Finance: Major Campaign To End "Gross Overtaxation Of Savings"

The campaign – which includes a special web site through which New Zealanders can e-mail their own and other MPs and party leaders – is backed by Age Concern, Consumer NZ, the Financial Services Council and the Taxpayers’ Union. More>>

ALSO:

Scoop Business: Leighton-Led WGP To Build, Manage Transmission Gully

The Wellington Gateway Partnership, led by a unit of ASX-listed Leighton Holdings, has won the $1 billion contract to build the Transmission Gully road north of Wellington. More>>

ALSO:

Gareth Morgan: The Government’s Fresh Water Policy – Revisited

Fresh water quality is the latest area to be in the sights of Gareth Morgan and his research organisation The Morgan Foundation... They found that the fresh water policy was a bit murkier than the Environment Minister let on. More>>

ALSO:

Interest Rates: RBNZ Hikes OCR To 3.5%, ‘Period Of Assessment’ Now Needed

Reserve Bank governor Graeme Wheeler raised the official cash rate as expected, while signalling a pause in rate hikes to assess the impact of moves so far this year. The kiwi dollar sank after Wheeler said its strength was “unjustified” and that the currency could have “a significant fall.” More>>

ALSO:

Fonterra: Canpac Site 'Resize' To Focus More On Paediatrics

Fonterra is looking at realigning its packing operations at Canpac, in the Waikato, to focus more on paediatric nutritionals... The proposed changes could mean around 110 roles may not be required at the site which currently employs 330. More>>

ALSO:

Scoop Business: Postie Plus Brand Gets 2nd Chance With Well-Funded Pepkor

The Postie Plus brand is getting a new lease of life after South Africa’s Pepkor bought the failed retailer’s assets out of administration and said it will use its purchasing power to reduce costs of stock and fatten margins. More>>

ALSO:

Get More From Scoop

 
 
Computer Power Plus

Standards New Zealand

Standards New Zealand
 
 
 
 
 
 
 
 
Business
Search Scoop  
 
 
Powered by Vodafone
NZ independent news