N.Z. seen in new light

Press, 26 January 1988, Page 25

N.Z. seen in new light

By

PETER HALLWRIGHT

NZPA London European investors are beginning to see New Zealand in a new light as the dust settles from the October equities shake-out, according to a London investment adviser.

Attracted first by New Zealand’s sky-rocketing market — for a-time the best-performing in the world — Europeans will soon be looking to steadier virtues in Australasia. A New Zealander, Peter Williams, who sets up “high-risk, high-return” special purpose investment structures, admits his business took a big dive within two weeks of Black Monday.

“It’s on hold,” he said.

“Investor mentality is running 0 scared and there’s a flight into liquidity.”

Boosted by thousands of small investors, the New Zealand market had further to fall than other larger markets. “Companies that had no cash flow are going out of business, but that’s life,” Mr Williams said. "Once all the emotionalism is gone, my kind of investor will be back in there.

“In a few months it will be seen as a nice, safe place with no exchange controls.”

The appeal of the South Pacific would remain, but this time with investors plumping for solid companies with a good track record in their own right.

At the same time, with the heat gone out of the local market, New Zealand investors are starting to pay more attention to opportunities in Europe and the U.K. “They’ve been more prepared to listen over the last few months,” Mr Williams said.

A graduate of Otago

University, he came to London in the 1970 s on the usual grand tour, found a job and spent seven years working for Manufacturers Hanover Trust in Geneva.

He helped set up a small finance company there with a Swiss partner before returning to London to open a second office. . Institutions and fund managers in Central Europe and the Middle East provided much of the business. Their enthusiasm for the South Pacific grew not just with the “quirky, illogical” economic deregulation carried out by Labour governments, but with non-financial activities such as New Zealand’s anti-nuclear stance and the America’s Cup.

“Australia and New Zealand were doing all the things we don’t seem to be doing in Europe,” Mr Williams said. He is confident investors will continue to admire the efforts of the best of the New Zealand entrepreneurs. “They’ve done some good deals. Ron Brierley failed three times in takeover bids and turned them into raging successes,” he said.

“By and large you get credit for being a smart Antipodean.”

With most of the action taking place in Britain, support for New Zealand could be expected there. But the Europeans, alerted to goings-on abroad by the internationalisation of exchanges, have not been far behind. Meanwhile, Peter Williams says, there is plenty of room for Antipodeans to look beyond the U.K. into Europe.

“There’s a lot of inroads being made in Europe — and a lot more potential,” he said.