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Heartland NZ taps underwriters for two-thirds of $35 mln SPP

Heartland NZ taps underwriters for two-thirds of $35 mln share purchase plan

By Paul McBeth

Aug. 30 (BusinessDesk) – Heartland New Zealand Ltd., the lender formed in the merger of Marac Finance with the Canterbury and Southern Cross building societies, raised two-thirds of its capital from underwriters and sub-underwriters in its $35 million share purchase plan.

Some 1,090 holding 15% of the lender bought 23.3 million shares at 52.2 cents apiece, raising $12.1 million, leaving underwriters Pyne Gould Corp. and Impact Capital Management, and unnamed sub-underwriters to buy 35.2 million at 65 cents a share, raising $22.9 million. All of Heartland’s board and senior management participated in the scheme.

Shares in Heartland were unchanged at 56 cents, and have tumbled 39% this year.

Combined with two $10 million private placements from PGG Wrightson Ltd. and PGC, the lender has tapped investments for some $58 million to pay for PGG Wrightson Finance as it looks to build its presence and achieve a banking licence.

“We are pleased to support Heartland’s strategy and in particular the capital raising,” PGC chairman Bryan Mogridge said in a statement. “The PWF acquisition will, we believe, create value and is an important step for Heartland towards achieving its goals.”

PGC pushed its Marac finance unit into the Heartland merger, then distributed most of its stake among its own shareholders. Its shares were unchanged at 32 cents today.

Heartland’s three biggest institutional shareholders are Impact Capital, Accident Compensation Corp., and PGC after the capital raising.

It made a maiden annual profit of $7.1 million in the year ended June 30. It expects that to climb to between $20 million and $24 million next year when it adds the Wrightson Finance unit, which will boost total assets $500 million to $2.6 billion.

The lender said it has $586 million in cash, liquid assets and available funding lines, though that has reduced in the past month due to increased lending.


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