Strong opportunities for Saudicorp

Press, 15 August 1984, Page 37

Strong opportunities for Saudicorp

Opportunities for business have never been stronger, says the chairman of Saudi New Zealand Capital Corporation, Ltd, Mr 0. R. Gunn, in the company’s reEt for the year ended rch 31. Saudicorp, New Zealand’s first investment bank, could have had an even better result if the Corporation had been in a position to apply more usual funding criteria to its activities. Mr Gunn says, “Difficulties in accessing the domestic funds market constrained and inhibited our money market operations.

In short, certain business which was available to us, and which fell within prudent financing criteria, had to be declined.” Saudicorp, which is a private company 50 per cent owned by Prince Nawaf Bin Abdul Aziz Al Saud of Saudi Arabia, reported a 78 per cent increase in profits for the year, of $2.8 million, compared with $l.B million last year. Mr Gunn says in the report that last year’s result was affected by a significant write-off, but that this year no write-offs or provi-

sions for possible investment losses nad to be made. Since its inception in 1980, Saudicorp has seen a surge of new companies engaged in “what has become a “vogue’ area of investment in listed and unlisted equities and venture capital.” Saudicorp says it is not threatened by these competitors and sees the growth in the number and size of companies who are able to marshall and invest risk capital as a further logical move in the development of New Zealand’s capital market. “A feature of the more

mature markets of the Northern Hemisphere is the tendency for such organisations to work together to spread risks,” he says.

“Although this is starting to happen in New Zealand, we look forward to further development of this trend.” In spite of the increase of the number of financial intermediaries operating now in the same area as Saudicorp, Mr Gunn says that market requirements are still not being met. The general manager, Mr R. L. Gaskell, reports that investments in listed and unlisted companies more than doubled to $16.7M. Among unlisted companies, Saudicorp was involved in New Zealand Primary Processors, Ltd, Pacific Pine Products, Ltd, the Southgas Resources joint venture, Southern Blue Fin Tuna, Karamea Oil Exploration, and Kauri Deposits Surveys. In underwriting it was involved in Perry Dines Corporation and Horizon Oil Exploration. A significant shareholding in Wilson Neill, Ltd, was also acquired.