Market quiet but firm

Press, 10 August 1981, Page 22

Market quiet but firm

By

The New Zealand share market firmed slightly last week in quiet trading. The N.Z.U. index gained 5 points during the week, but most leaders were steady. The listing of Bendon was one of the highlights of the week: the shares opened on Wednesday at 200 c — giving the stags a profit of 50c — and stood up well under the inevitable profit taking to close on Friday at 187 c.

Motor Traders, Ltd, is expected to announce a tie-up with Andrews and Beaven this week.

The key to the merger may be expected to be H. W. Smith, Ltd, the Christchurchbased group run from Wellington by Mr Bruce Judge, who is a director of Motor Traders. Smiths owns 48 per cent of Motor Traders. They had an existing shareholding through their associate, Buntings, and this was increased by the take-

ADRIAN BROKKING,

commercial editor

over this year of a shareholding held by Borg Warner. In addition, the chairman of Andrews and Beayen (Mr W. B. Barnes) is also chairman of Buntings, of which Mr Judge is also a director. Brierley Investments is not expected to play a key role as it reportedly owns only six per cent of the Motor Traders’ capital. Investment circles say that in any takeover, Motor Traders shareholders are likely to be offered around 90c a share, assuming that the same price is negotiated as with Borg Warner to sell its shares. The Motor Traders’ group will have to substantially write down its stocks which will adversely affect the asset backing of its shares.

Industry sources say that the auto parts industry is passing through difficult times, mainly because of the change to Japanese cars

which last longer. Most of the major spare parts comKnies are tied to British and S. franchises.

One more Christbhurch company will soon disappear from the list — again to be controlled from Dunedin —

when the take-over of Alloy Steel by Farra Engineering is completed. Alloy’s chairman (Mr Neil Isaac) announced that the Alloy board were recommending acceptance of Farra’s 375 c a share offer.

He said that Mace Engineering had accepted the Farra Dunedin offer in respect of shares earlier held by it, withdrawn its own offer, and had already returned to Alloy Steel shareholders acceptances received in respect of its own offer — so that those Alloy Steel shareholders would be free to accept the higher offer from Farra Dunedin Engingeering. Ltd.