Investor grabs chunk of Smiths

CECILE MEIER
Last updated 05:00 03/07/2014

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A well-known investor looking for a bargain has taken a strategic stake in Christchurch-based retail chain Smiths City.

Duncan Saville's investment company, Utilico Investments, yesterday declared a 13.6 per cent stake in the national retailer of home appliances, furnishing, electronic goods and sports gear.

Utilico's strategy is to invest in "undervalued" companies.

One of Utilico's top 10 investments is New Zealand infrastructure company Infratil. Utilico has an 8.8 per cent holding, and Saville is a director.

Almost four years ago Saville was leading a group of investors, including Ngai Tahu and the New Zealand Superannuation Fund, seeking to buy the collapsed South Canterbury Finance.

Utilico has diverse investments - in gold mining, wind power, waste treatment and financial services companies, according to its website.

Saville could not be reached yesterday for comment. He is living in Singapore, a source said, but had previously resided for several years in Australia.

A chartered accountant, Saville is a director of ICM, the company that manages Utilico's investments.

Smiths City managing director Rick Hellings said Utilico Investments was new to the company's shareholding.

He would not comment on the details of the transaction, but said there had been transfers between major shareholders in the last couple of weeks - three shareholders had sold and Utilico had bought.

It appears that Utilico has bought the 5.1 per cent stake in Smiths City from Wellington rich-lister John Holdsworth, who notified the NZX yesterday that he no longer held the stake.

Two other large shareholders are Superannuation and Mutual Savings, owned by Auckland investor Douglas Belton and family, who in March this year held 15.7 per cent of Smiths City; and California-based Guaranty Finance Investors with 18.3 per cent.

Hellings said Smiths City had not met Utilico representatives and did not know about them.

James Smalley, a director of sharebroker Hamilton Hindin Greene, said Smiths City was a relatively illiquid stock and tended to trade on the sharemarket at a sizeable discount to its net assets. That discounted price could well have attracted Saville.

There were only four trades yesterday in Smith City shares, which closed unchanged at 54 cents.

"Generally they're [Utilico] looking at undervalued assets, so maybe it's something to do with that," Smalley said.

"It's their finance arm [Smith City's] that makes most of the money."

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- The Press

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