Equiticorp to be biggest independent investment bank

Press, 29 February 1984, Page 30

Equiticorp to be biggest independent investment bank

PA Auckland Equiticorp Holdings, Ltd, an independent investment bank which will have a paid capital of $35 million, will make its debut in April. The public will be given the opportunity to subscribe $l5 million of the capital. A paid capital of $35 million would make Equiticorp the largest independent investment bank in the country. Marac Holdings has a paid capital of $23.8 million and Broadbank Corporation $25 million.

The issue will launch one of the biggest single new businesses into the market in recent years. A prospectus is to be registered in April. Following the issue it is intended to seek stock exchange listing.

The present managing director of CBA Finance, Ltd, Mr A. R. Hawkins, has been invited to be chairman of Equiticorp.

He is understood to have said he will accept the appointment as soon as his contractural obligations to CBA Finance permit. Mr G. Adams, the managing director of Marac Holdings, Ltd, who announced yesterday that he is to leave that position, has been appointed the deputy chairman.

At March 31, Equiticorp will be an unlisted public company with a paid capital of $2O million. The injection of outside funds will lift the paid capital to $35 million, made up of $25 million in ordinary shares of 50c each and $lO million in non-convertible specified preference shares,

also of 50c each. The public will be offered 15 million ordinary shares and, on a one-for-one basis, 15 million specified preference shares. The coupon rate on the specified preference shares has not yet been determined, and they will be redeemed for cash on a date to be set. Subscribers will be required to subscribe for both classes of share. The issue price of 50c a share is said to equate net asset backing. The public issue is to be organised and underwritten by an Auckland broking house.

Market sources say the broker involved is Morrow and Benjamin. Of the ordinary capital, 40 per cent will be held by Bayldon-Hawkins family interests. The balance will be held by long-term investors and employees, about 30 per cent, with the remaining 30 per cent in public hands. Equiticorp has an option to buy 49.9 per pent of the issued capital of Teltherm Industries, Ltd, from other Bayldon-Hawkins interests, and shareholders of Teltherm on the register as a February 28 will have a preferential right to shares in Equiticorp.

In addition to Mr Hawkins and Mr Adams, the directors of Equiticorp will be: Mr M. H. Coney, at present the group general manager, International Banking, for Marac; Mr K. J. Gillespie, until recently the general manager, administration, of CBA Finance; Mr I. L. Gunthorp, company secretary of CBA Finance; Mr P. W. Saunders, a chartered accountant; Mr

J. M. R. Syme, the group general manager of Marac; and Mr B. V. Walsh, general manager, corporate finance, of CBA Finance.

The directors say they believe there is a real need for the introduction to the domestic market of a soundly based and independent investment bank with a large capital base. They say Equiticorp will be engaged in a wide range of merchant banking, financial services and investment advisory services. The company will operate from Auckland, Wellington and Christchurch. It will also be the holding company of a group which will include subsidiaries operating in investment and merchant banking in Hong Kong and Australia.