MARKET CLOSE: NZ shares dip as Fletcher gives up pursuit of Steel & Tube
By Paul McBeth
Oct. 15 (BusinessDesk) - New Zealand shares dipped, outperforming many Asian markets, as Fletcher Building aborted its
pursuit of Steel & Tube Holdings after its increased offer wasn't warmly embraced by the target.
The S/NZX 50 index declined 5.17 points, or 0.1 percent, to 8,838.07. Within the index, 26 stocks fell, 19 gained and five
were unchanged. Turnover was $132.8 million.
Fletcher fell 0.8 percent to $6.10 in busier activity than usual, with 4.6 million shares traded. The country's biggest
listed building company gave up plans to buy Steel & Tube when the steel products maker wouldn't immediately endorse an increased offer of $1.90 per share, plus scope for
the smaller firm to pay a 5 cents per share special dividend.
Steel & Tube stock jumped as high as $1.73 after announcing the increased offer, before closing down 1.3 percent to $1.48. Some
1.2 million shares were traded - more than five times the stock's 90-day average.
"It was a pretty quick turnaround there - the few shareholders who traded in that hour or two will be a little bit
annoyed," said Grant Davies, an investment advisor at Hamilton Hindin Greene. "Now it's up to Steel & Tube to show they've made the right call in rebuffing Fletcher."
Stock markets across Asia were largely weaker, with Australia's S/ASX 200 index down 0.9 percent in afternoon trading, Hong Kong's Hang Seng down 1 percent and China's Shanghai
Composite index falling 0.8 percent. Davies said US President Donald Trump's warning against Saudi Arabia over the
disappearance of a journalist in Turkey raised uncertainty for global investors.
A2 Milk fell 1.1 percent to $9.78 on volumes of 1.1 million, weighing on the broader market. Synlait Milk, which
supplies A2, fell 2.1 percent to $9.20
Property companies were also among the most traded stocks. Precinct Properties New Zealand fell 0.4 percent to $1.41
with 1.2 million shares changing hands; Goodman Property Trust fell 1.3 percent to $1.52 on volumes of one million
shares, and Kiwi Property Group was unchanged at $1.35 with 1.6 million shares traded.
Kathmandu Holdings led the market lower, down 2.3 percent to $2.92 on volumes of 721,000 - more than four times its
90-day average.
Spark New Zealand gained 0.9 percent to $3.895 on volumes of 3.3 million shares. Ryman Healthcare rose 2.4 percent to
$12.80 with 1.2 million shares traded.
Comvita posted the biggest gain on very light volumes, up 2.6 percent to $6. Sky Network Television was up 2.4 percent
to $2.12 in subdued trading ahead of its annual meeting on Thursday.
Heartland Bank rose 1.2 percent to $1.65 after telling the Australian Financial Review it's increased its share of
Australia's reverse mortgage market to 20 percent.
Trustpower increased 0.7 percent to $6.12 after raising March-year earnings guidance by $10 million to $215 million to
$235 million. Infratil, which owns a controlling stake in Trustpower, slipped 0.1 percent to $3.46.
NZX was unchanged at $1.05 on average volumes. Salt Funds Management said it plans to list a carbon fund on the NZX next
month.
Outside the benchmark index, Michael Hill International sank 24 percent to 74 cents in heavy trading after reporting an
8.8 percent slide in first-quarter sales. The jewellery chain said it had underestimated how much it needs to spend on
marketing since ditching a discount sales strategy.
Pacific Edge jumped 17 percent to 38.5 cents, adding to its 14 percent gain on Friday. The bladder cancer test maker
said Johns Hopkins Medicine has started evaluating the use of the company's Cxbladder test.
(BusinessDesk)