PGC breaks with long-held tradition
Pyne Gould Corporation, controlled by businessman George Kerr, is breaking its ties with Canterbury and will hold its annual meeting in Auckland.
It is understood to be the first time the annual meeting has been held out of Canterbury, where Pyne Gould's history goes back more than 150 years.
Chairman Bryan Mogridge said there were 259 shareholders in Canterbury and 550 in the Auckland-North region and PGC was registered as an Auckland company now, "so it seemed more logical to have it here."
It will be held on November 28 at the AMP Centre in central Auckland.
About five months ago PGC changed its registered office from Christchurch to Queen St, in Auckland.
Kerr and Pyne Gould made much of Kerr's links to the firm's Canterbury founders in mid-2009 when PGC revealed $180 million of bad loans at Pyne subsidiary Marac Finance.
Kerr is the great-great grandson of F H Pyne, who founded Pyne and Co in 1887 which became part of the Pyne Gould Guinness group in 1919.
Kerr faced hostile shareholders at the annual meeting in Christchurch last year but Mogridge did not agree that was the reason for the Auckland venue this time.
"I don't see why they would be hostile, frankly. Without PGC Heartland would not have been formed, and more specifically without George's money and underwrite [of a $272.5m capital raising in late 2009] it wouldn't have happened."
The annual report for the year to June 30, 2012, reveals departed PGC managing director John Duncan received $333,333 cash for nine months of work. He resigned on April 26 and Kerr took over the role.
For just over two months' work as managing director, Kerr received $39,167.
Mogridge said Kerr's salary as managing director would be about $235,000 a year and he would not receive director's fees. Kerr received $195,833 fees in the June 2012 year.
The directors' fees pool is $700,000. In the June 2012 year $493,000 was paid to directors.
Asked whether the $700,000 pool would be reduced because PGC was much smaller now, Mogridge said, "We will just see what happens over the next year."
Mogridge's fees as chairman were $235,500 in the June year and asked if that amount was justified, he said: "Oh I think so, the amount of work and effort that goes in."
PGC has been up against the Financial Markets Authority over $28m of lending from the Perpetual Cash Management Fund to Torchlight Fund No 1 LP. PGC does not regard this as related party lending and has not included it in the annual report segment on related party lending.
PGC owns a stake in the Torchlight Fund and manages it but it manages the cash fund. Mogridge says the cash fund has separate accounts and unitholders "so is nothing to do with PGC".
PGC is in the process of selling the Perpetual group and will be left with the asset and funds management business of Torchlight, the Van Eyk research business, the EPIC infrastructure fund and some property assets.
The annual report reveals Perpetual group has more liabilities than assets - $11.72m of liabilities against $8.63m of assets at the June 30 balance date. Perpetual's commissions and fees amounted to almost $17m but its operating expenses of $21.5m resulted in an after-tax loss of $5.2m.
None of the businesses within PGC - Perpetual, Torchlight or its property investments - made a profit in the June 2012 year and PGC reported a $47.7m loss.
- © Fairfax NZ News
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