Brierley acquires control of Metters N.Z.

Press, Volume CXII, Issue 33096, 11 December 1972, Page 22

Brierley acquires control of Metters N.Z.

t/Vew Zealand Press Association)

WELLINGTON, December 8.

Brierley Investments, Ltd, has acquired a controlling interest in Metters (N.Z.), Ltd, sanitary-ware manufacturer, for 130 c a share and as announced, it is making a similar offer for the remainder of the shares. The take-over scheme was announced soon after the chairman of Brierley Investments (Mr R. A. Brierley) had mentioned it at the annual meeting, without giving details.

Metters (N.Z.) is a manufacturer of porcelain enamel- | led cast-iron baths and basins. It is based at Petone. Brierley acquired 65 per ’cent of the Metters (N.Z.) issued capital that was held by Metters, Ltd, Sydney, a member of the General Industries group bringing Brierley’s total holding to 68.8 per cent lor 178,887 shares. A condition of the sale by i Metters, Sydney, was that the other shareholders be offered 130 c a share also.

Metters (N.Z.) paid dividends of 9 per cent in 1969 and 1970, covered 1.2 times and 1.0 times respectively by the trading profits. In 1971, it paid a 50 per . cent dividend from capital (Profits, requiring $129,875. The net profit was $22,984 in 1970 but was only $3168 in 1971.

At December 31, 1971, the company’s last balance date, shareholders’ funds in Metters (N.Z.) were $536,000 ($608,000 a year earlier), consisting of $260,000 (unchanged) ordinary capital, $60,000 (unchanged) ordinary reserves, $197,000 ($223,000) capital reserves, and $19,000 ($15,000) unappropriated profits. Net tangible asset backing was 206 c a 100 c share.

Mr Brierley said at the annual meeting that company policy had always been to restrict the issue of capital as far as possible. The over-all growth in the size of the group, however, required a reasonable balance of equity and, in the current term, the capital of the parent company would be increased to $600,000 as a re-

suit of the present cash issue and the acquisition of Asparagus, Ltd, he said. The Asparagus take-over, and other developments since June 30, both in Australia and New Zealand, lent substance to the directors’ confidence that the results to be presented in 1973 would be entirely satisfactory to shareholders, and the increase in capital amply justified, Mr Brierley said.

Continued prosperity

A complete review, on a realistic basis, of the company’s progress over the last five or six years, and an assessment of its capacity for genuine growth over a similar period into the future, had disclosed a very satisfactory position, he said. Commenting on the likely effect on the group of the changes in Government in New Zealand and Australia, Mr Brierley said there was no reason to suppose that the company would not continue to prosper at least as well as any other soundly managed and financed public enterprise. “In fact, we believe that an increasing awareness in government and industry of the necessity to produce positive results is conducive to additional support for our concept of using capital resources to their fullest extent,” he said. A new factor which had recently arisen in Australia was a trend towards harassment of companies which were presumed to be identified with capital of overseas origin. While this was relevant to the future of the Australian subsidiary, Industrial Equity, Ltd, it was inconceivable that there could be any permanent discrimination against Industrial Equity, or any other Australian company which happened to have a strong measure of New Zealand participation, Mr Brierley said.

Equally inconceivable was the establishment of a twotier economy with different rules for those companies which had attracted the support of overseas investors and those which had not.

In any event the group’s flexibility and capacity for rapid adjustment would enable it to relate favourably to changing circumstances, Mr Brierley said.

To a shareholder who raised the subject of auditors’ qualifications of the accounts of some Australian subsidiaries, Mr Brierley said it was an untidy situation that should not exist. Brierley Investments had inherited it and the directors would give high priority to correcting it, he said.