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MARKET CLOSE: NZ stocks rise, led by NZS, PGW

MARKET CLOSE: NZ stocks up; lifted by Olam’s 70 cents-a-share offer for Farming Systems

By Jason Krupp

Aug. 24 (BusinessDesk) - New Zealand stocks rose for the fourth time in five sessions, led by NZ Farming Systems Ltd. following the announcement that Olam International had raised its takeover offer, winning support of a major shareholder.

The NZX 50 rose 7.8 points, or 0.3%, to 3024.6. Within the index, 15 stocks rose, 19 fell and 16 were unchanged. Turnover was $76.2 million.

Farming Systems rose 11.1% to 70 cents, leading the NZX 50 higher, as the share price surged to match the newly revised offer from Olam, the Singaporean food chain giant. Olam increased its shareholding in Farming Systems to almost 37%, having won agreement from Accident Compensation Corp. to sell its 7% stake in the South American dairy farm developer.

“I suspect that you’ll see a conclusion at this price now that ACC has agreed to sell its stake,” said Rickey Ward, domestic equities manager at Tyndall Investment Management. “It’s certainly good news for shareholders - this was a company that was pretty easy to dislike, but I guess fortune favours the brave.”

PGG Wrightson Ltd., the rural services company, rose 5.7% to 56 cents on the new. The company owns an 11.5% stake in Farming Systems, which it had previously agreed to sell to Olam at 55 cents a share. Ward said it was very likely that Wrightson had an exit clause to this agreement, which explained its gains on the day.

Fisher & Paykel Healthcare Corp., the medical device manufacturer, rose 2.9% to $2.85, Goodman Fielder Ltd., the food ingredient maker, rose 2.5% to $1.65, and pay-TV television operator Sky Network Television Ltd. rose 2.4% to $%.10.

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DNZ Property Fund Limited, which listed on the NZX earlier this month, rose 2% to $1.04 after the company announced that it had completed the sale of two vacant industrial sites near the Auckland International Airport for $2.9 million. The proceeds of the sale will be used to repay bank debt, the fund said in a statement today.

Charlie's Group Ltd. rose 11.1% to 10 cents after the juice and soft-drink company announced that it has topped its own record profit forecast on record sales in the year ended June 30, with a net profit of $2.5 million as compared with a $1.8 million net loss the previous year.

Auckland International Airport Ltd., the nation’s busiest gateway, rose 1% to $1.98 after reporting a 4.9% month-on-month rise in international passenger traffic excluding transits for July.

Shares in Dorchester Pacific Ltd., which kept receivers at bay by convincing investors to accept a grab-bag of securities in exchange for their debentures and notes, were unchanged at 10 cents. Earlier today the company announced that it had raised $10.3 million through a capital raising, which was at the top end of its targeted $8 million to $10 million. The deal was underwritten by $7 million by major shareholders the Business Bakery and Hugh Green Investments.

Cue Energy Resources Ltd., the oil and gas producer, was unchanged at 37 cents after the company announced that it has turned a profit as production income ramped up 80% in the year ended June 30. The company, which is 23.6% owned by Todd Petroleum Mining and listed on both the ASX and NZX, reported a A$27.5 million (NZ$34.4 million) annual net profit compared with a A$22.6 million net loss a year earlier.

ING Property Trust, the listed property manager, was unchanged at 69 cents. At its AGM earlier today the company said it was well positioned to meet the challenging times ahead for New Zealand’s property market, and expects to pay an a 7 cents a share dividend the year ending March 31, 2011.

Telstra Corp., the Australian telephone company, fell 2.4% to $3.68, pacing declines on the day. Telecom Corp., New Zealand’s largest telephone company, fell 1.9% to $2.03, giving up much of the ground it gained yesterday.

Kathmandu Holdings, the outdoor clothing retailer, fell 2.4% to $1.65, Westpac Banking Corp, the Australian lender, fell 2.3% to $27.15, and fishing company Sanford Ltd. fell 2% to $3.92.

Zintel Group Ltd., a provider of telecommunications tools on both sides of the Tasman Sea, was last trading unchanged at 30 cents on the NZAX small cap. The company said earlier that it was considering a move to the main NZX board to lift liquidity and boost its profile.

(BusinessDesk)

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