Equiticorp tones down bank plans

Press, 22 September 1987, Page 38

Equiticorp tones down bank plans

By

NICK BROWN

NZPA Sydney Equiticorp Holdings plans to use U.K. merchant banking conglomerate, Guinness Peat Group Pic, for expansion into Europe and the United States, according to Equiticorp chairman, Mr Allan Hawkins.

However, after Equiticorp last week claimed victory in its battle for control of Guinness Peat, Mr Hawkins adopted a more cautious tone when interviewed on Channel Ten’s Business Week programme on Sunday evening. He said that Equiticorp now held 42 per cent of Guinness Peat but it was not a foregone conclusion that the Bank of England would approve of that shareholding. The Bank of England could still reject Equiticorp’s £356 million (JNZ9IOM) at this late

stage if the central bank ruled that Equiticorp’s control was contrary to the public interest The Bank of England could force the sale of foreign holdings which exceed 15 per cent of a bank’s voting rights. Mr Hawkins said Equiticorp may have to sell off the banking arm of Guinness Peat He said Guinness Peat would provide an important vehicle for Equiticorp in Europe and the U.S.

“It leads into the U.S. through the funds management operation and, of course, they have got the very good investment in Guinness Peat Aviation,” he said.

“There are a lot of angles in there that we like.”

Last week, Equiticorp increased its offer from IlOp a share to 115 p after what it termed “amica-

ble” discussions with Guinness Peat's board. But the Guinness Peat directors said they still regarded the new offer as inadequate because it did not reflect the underlying value of Guinness Peat’s businesses or its prospects.

Mr Hawkins also said on the Business Week programme that Equiticorp planned to work alonside

the U.K.-based Redland Pic on the future of Australian building products group Monier. Redland gained control of Monier by lifting its holding from 49.9 to 50.1 per cent, while Equiticorp has accumulated about 40 per cent through its takeover bid.

Mr Hawkins said Equiticorp would not equityaccount its sAust3ooM (SNZ34OM) investment without board representation.