Rates round-up: August 6
Perpetual to wind up one fund, ‘internalise’ another; Nuplex to redeem capital notes; Dorchester warns of low-ball offer
Monday, August 6th 2012, 6:00AM
by Niko Kloeten
Perpetual, which has been recently embroiled in controversy over related-party loans to the Torchlight Fund, will close down its Mortgage Fund and ‘internalise' its Cash Fund.
In an oral judgment released last Friday, High Court Justice Paul Heath gave Perpetual 10 working days to provide proposals for winding up the Mortgage Fund and internalising the Cash Fund.
"I am told by counsel that "internalisation" of the Cash Fund is intended to restrict the allotment of units in that Fund to investors which are, broadly, trusts of which Perpetual is a trustee, or otherwise do not constitute "members of the public" for the purposes of the Securities Act 1978," Justice Heath said in his judgment.
The Mortgage Fund was recently frozen after a surge of redemptions from investors. Justice Heath also continued the appointment of Vivian Fatupaito and Chrisopher Duffy from accounting firm WHK as "observers" of Perpetual's activities.
Meanwhile, Pyne Gould Corporation is looking to sell Perpetual and says it has received interest from a number of potential buyers.
If all or part of Perpetual is divested PGC plans to invest more capital in Torchlight, which will be the main part of the business.
Nuplex to redeem capital notes
Listed resins business Nuplex has announced it will redeem and cancel just under $53 million of capital notes, following a successful US debt placement.
Nuplex will redeem the $52.6 million of notes on September 15 using existing bank facilities.
The company recently announced that it had raised US$105m of notes maturing in 2019 at a coupon rate of 6.125%, through the US Private Placement market.
Nuplex's chief financial officer, Ian Davis, said: "By raising funds in the USPP market we have been able to access long term, fixed price debt which balances and strengthens our overall funding position by extending our maturity profile and diversifying our funding sources."
Dorchester warns of low-ball offer
Dorchester Pacific has warned shareholders of a low-ball offer significantly lower than its own buy-back offer to noteholders.
Dorchester recently announced a proposal to buy back the 2013 notes at 92c per note; a special meeting of noteholders has been called for August 14 to consider an extraordinary resolution approving the buyback.
However, it has become aware that since that announcement Stock & Share Trading Co, a company incorporated in Australia, has circulated an offer to noteholders to buy the notes at 70 cents per note.
"Directors strongly recommend that noteholders consult their financial adviser about the lower offer of 70 cents from Stock & Share Trading," Dorchester said.
Stock & Share, which is run by Melbourne businessman John Armour, has made low-ball offers to investors in several New Zealand listed companies and has been warned by the Financial Markets Authority over its activities.
Niko Kloeten can be contacted at niko@goodreturns.co.nz
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