Commission rebuffs bid by Simpson

Press, 17 May 1989, Page 34

Commission rebuffs bid by Simpson

The Commerce Commission has declined to give initial clearance to the bid for a 30 per cent stake in Fisher and Paykel by Simpson Appliances N.Z., Ltd. The decision was announced on Monday — the same day the sale of the stake to other parties was announced. Simpson Appliances is a wholly-owned subsidiary of the Australian whiteware and building products group, Email. Dr Susan Lojkine, the chairman, said the Commission had also declined to give initial clearance for two other proposals from Simpson: that it acquire not less than a majority of the issued ordinary shares of Fisher and Paykel Industries; and that it acquire the business and assets of Fisher and Paykel, Ltd, the whitegoods manufacturing and distributing subsidiary of Fisher and Paykel Industries. At Simpson’s request, the commission treated these other two proposals as confidential during the initial stages of its investigation. On Monday, the statutory managers of Equiticorp International (in receivership) announced Equiticorp’s 30 per cent stake in Fisher and Paykel had been sold. The 26 million shares were sold for a total of SIO4M. The buyers included ANZ McCaughan, of Melbourne, acting for a number of overseas buyers; Doyle Paterson

Brown, a Wellington sharebroker, also acting for overseas buyers; the Queensland Treasury Corporation; the AMP Society (Brisbane); and Suncorp Insurance and Finance. The shares had been held by Equiticorp Industries and are now on their way to buyers in Britain, the United States, Australia and New Zealand. Settlement is due on Friday. The chief executive of Brierley Investments, Mr Bob Matthew, said his company's application to the commission would remain but the odds were that the company’s acquisition plans would be left on the table. The Commission was not satisfied that the proposals would not result in the acquisition or strengthening of a dominant position in a market. Dr Lojkine said that Fisher and Paykel had a very large share of the whitegoods supply market while Simpson is its major competitor. While import barriers had been considerably reduced in recent years, the commission was not yet satisfied that actual or potential competition would be such as to provide a constraint on a merged Simpson and Fisher and Paykel. She said another matter requiring additional investigation was whether Simpson’s acquisition of Equiticorp’s shareholding would give it control or sufficient influence over Fisher and Paykel to raise competition concerns.