Fletcher, N.Z. Steel?

Press, 18 January 1986, Page 1

Fletcher, N.Z. Steel?

PA Wellington Fletcher Challenge, Ltd, is investigating the possibility of taking over the Government’s 81.2 per cent holding in New Zealand Steel, Ltd, says the managing director, Mr Hugh Fletcher. “We see it as an obvious thing,” he said yesterday. “We are looking at it, but I wouldn’t put any sort of probability on it.” Fletcher’s has in recent weeks sold its banking unit, Broadbank Corporation, Ltd, and a 60 per cent holding in Marac Holdings, Ltd.

Mr Fletcher said the company was looking at othel* acquisitions, but did not name them.

The company has four wholly owned or managed units manufacturing and distributing steel and a 44 per cent holding in an iron and steel maker, Pacific Steel, Ltd. Mr Fletcher said it was logical for his company and Broken Hill Proprietary Company, Ltd, of Australia, to look closely at acquiring New Zealand Steel.

“Everyone who is in the steel business in this part of the world will look, but that’s a very long distance from saying we will make

an offer,” he said.

On Christmas Eve, the Government said it would take over $1,138 billion of New Zealand Steel’s debt in return for an issue of four shares for each share on issue.

The company’s shares traded at 90c yesterday compared with 138 c before the Government’s announcement.

At present market prices, this would give the Government an estimated loss of |922 million, share analysts estimated.