News Round Up

New mining indices, Possible funds management player, Changing market results in advisory firm sale. Comment: Bad name not deserved.

Monday, August 7th 2006, 5:38AM

Standard & Poor’s has launched two new sector-specific indices in the Australian market which cover the mining sector.

They are the S&P/ASX 300 Metals & Mining Index (XMM), and the S&P/ASX All Ordinaries Gold Index (XGD).

“These indices are ideally designed to support investors, the Australian mining sector which currently is experiencing robust operating conditions and other stakeholders,” S&P head of index services Jason Hill says.

At June 30 the resources sector accounted for more than 20% of total ASX domestic market capitalisation, and around one-third of listed companies by number.

The S&P/ASX 300 Metals & Mining Index comprises companies that are classified as being in the metals and mining industry. It includes producers of aluminum, gold, steel, precious metals and minerals, coal, and also diversified metals and minerals. The S&P/ASX All Ordinaries Gold Index will include companies that are included in the Gold sub-industry of the All Ordinaries Index.

Possible new fund manager

Rural Equities, which owns the management company of the $150 million NZ Rural Property Trust, is looking at getting more involved in the funds management industry.

It has set up another fund, the Pacific Equity Trust, by raising $19 million through a private placement. The largest investor is REL itself with $4 million in the fund.

While it is not seeking money from the public, the company is considering getting more involved in the area.

The Pacific Equity Trust has been established to take advantage of investment opportunities, principally in New Zealand and Australia by investing in listed and unlisted securities which represent good fundamental value with sound long term prospects.

“Expansion of the funds management business is a key strategy for REL,” chairman Selwyn Cushing says.

ABN Amro Craigs buys Greenslades
ABN Amro Craigs will establish a presence in Dunedin by acquiring local broker Greenslades.

The Invercargill and Christchurch offices of Greenslades will be merged into Craig’s existing offices in these locations.

The company says this deal will make it the largest private client investment advisory firm in New Zealand with a retail network of 14 offices plus four affiliates.

Craigs will have around $4 billion in the investment management and advisory space with total fee-earning funds under management and administration.

Greenslades managing director Roy Borgman, said the “investment advisory environment was changing and for the sake of our clients it was vital to be able to offer an even wider range of services and investment opportunities”.

Comment: Bad name not deserved
The unfortunate thing about the collapse of three finance companies in as many months is that they have given the whole sector a bad name – which it doesn’t deserve. [Read On]

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