PGC Wrightson hit by low-ball offer
Australian company Washington Securities has targeted yet another New Zealand stock with an unsolicited "low-ball" offer, this time PGG Wrightson.
Washington has today offered 20 cents a share to some PGGW shareholders, well below the stock's current market value of about 32c per share.
The agricultural services company said Washington had indicated further offers would be made to other PGGW shareholders over the next six months.
It's been a busy week for Washington Securities which repeated a below-market value offer to Heartland investors, and told Dorchester Pacific it was intending to make an offer.
Heartland shareholders were offered 55c a share, far below its current value at 86c.
The man behind Washington Securities is Australian lawyer John Armour, its sole director and shareholder, who has previously made offers for Vector, Tower, Fletcher Building, and Dorchester Pacific.
PGGW's company secretary Julian Daly said in a statement that Armour had links to another company, Stock and Share Trading Company, which made low-ball offers to PGGW shareholders last year.
Market participants had been calling for sterner action on low-ball offers, but regulations had "stopped short of an outright ban", he said.
Heartland Group's general counsel Michael Jonas said that while policies had been tightened at the end of last year, he would like to see more.
"My view is that they [people making low-ball offers] prey on people who are not well informed."
The regulations required greater disclosure by the company making the offer, so as to not mislead investors.
According to the Financial Market Authority, unsolicited offers have to include the market price of the shares, and a minimum offer period and cancellation period.
People who do not comply with the regulations could be fined as much as $30,000.