LPC shareholder wants trades reversed
A shareholder in Lyttelton Port of Christchurch remains angry that trades in LPC shares on Friday have not been cancelled and reversed as as result of what he calls a late trading halt.
As a substantial shareholder in LPC, Mike Daniel on Friday questioned the trading sequence on the NZX, and said the exchange had not acted correctly.
Today Daniel said the NZX exchange had still not rectified its mistake.
On Friday, Christchurch City Council's infrastructure arm Christchurch City Holdings Ltd announced it intends to buy the LPC shares it does not already own.
CCHL will this week launch a full takeover offer at $3.95 a share. It is also to pay a 20 cent dividend, taking the total payout to existing shareholders to $4.15 a share.
Daniel said he was selling a parcel of 5,000 LPC shares on Friday, and noticed a substantial security holder notice on the exchange in which, Port Otago, a 15.48 per cent shareholder in Lyttelton Port, disclosed it would sell its LPC shares to the council under a lockup agreement.
Daniel said this notice, issued at 2.24pm was the first indication of a takeover notice.
As a result of reading the information, he telephoned NZX head of regulation Robyn Dey to say there should be a trading halt on LPC shares, while the market digested the announcement of the takeover offer.
After he hung up the phone from the conversation with Dey, NZX did indeed issue a trading halt on LPC shares at 2.57pm.
But this was too late for a dozen or so sellers of the shares who had sold their shares at around $3.30 apiece, that was lower than the indicated takeover offer price, Daniel said. He had a ''small order'' of around 5,000 shares to sell at $3.30, and these indeed sold at this price a call to his broker confirmed.
Daniel, who holds a total 550,000 port shares and is a former chairman of Northland Port Corp, said he had called the NZX asking for a trading halt and to ask them to reverse the trades.
''She [Dey] didn't know anything about [the Port Otago substantial shareholder notice]. Within minutes of my hanging up on her, the trading halt had been put on. So they clearly missed it, completely.''
An hour later about 4pm, Dey had rung him back saying the reversal of trades would not occur. ''It is appalling,'' he said of that decision.
Later on Friday he had received a follow up letter from Dey, also stating the trades could not be changed.
Dey said the NZX had received a number of requests to cancel trades in LPC, that matched in the period between the release of a substantial security holder notice and the time at which NZX placed a trading halt in the security.
''NZX has limited powers under the NZX participant rules to cancel trades, which arise only when there has been an 'error' as defined. In this case there was no 'error' as defined in the rules,'' Dey said in a letter to Daniel.
Daniel said he would continue to try and get NZX to change its mind, and the trades reversed.