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Pyne Gould plunges 19% to record low after annual meeting

Shares in Pyne Gould Corp (NZX: PGC) plunged to a record low after yesterday's annual meeting, where chairman Bryan Mogridge told investors the firm will probably quit New Zealand.

The stock sank 19% to 22 cents in trading this morning, with about 0.08% of shares on issue changing hands. The shares have shed a third of their value this month and are now trading at a 41% discount to what managing director and controlling shareholder George Kerr paid earlier this year.

This afternoon, the share price recovered one cent to 23 cents.

Mr Kerr paid 37 cents a share to take control of the company with 77%, while warning that the difficult process of selling assets meant Pyne Gould was no longer a generator of dividend income.

The trading comes a day after the company's annual meeting in Auckland, where Mr Mogridge repeated his warning that the company will not pay dividends and told investors the board is "seriously considering the domicile of the company", which is unlikely to be New Zealand, and will update the market on its decision when it is made.

The firm has almost exited its last New Zealand asset, with Mr Kerr overseas trying to finalise a deal to sell the Perpetual wealth management assets. It had previously sold the corporate trust unit in a management buyout.

Pyne Gould is looking to get a return of more than 15% over a decade on its $97.5 million of net assets.

Its Torchlight Investment Group owns 19.7%of investor Torchlight Fund 1, which runs until 2019, and Torchlight Fund 2, which holds remaining bad loans carved off when Marac Finance was sold into Heartland New Zealand.

Pyne Gould's Torchlight Securities owns 27% of Equity Partners Infrastructure Company No 1, which in turn owns 17% of UK motorway services company Moto International Holdings.

(BusinessDesk)

Comments and questions
8

The only winner here is George Kerr and his mates.

George won't be upset with a lower share price - the lower the better as he averages down the price he pays for the company. His current average price is 37 cents and he will end up with an average around 30 cents. What is the NTA on the company - probably 50 or 60 cents.

Meanwhile, the investors - many of whom have been loyal long-term investors in the company - will get shafted.

Nope - Georgie boy has shafted himself big time with PGC. Been penny wise and pound foolish, lost the plot and is sitting on multi-million dollar losses on his stake (which he will never recover) plus his credibility in the market is zip.

Go overseas, George and take your independent chairman, Mogridge, with you.

He could have at least fronted the shareholders after what he has done.

What a pussy.

GK is a rich kid without the brains which is now being accurately reflected in the share price as he runs the company into the ground.

If GK spent as much time on genuine wealth creation for his shareholders as he did in backroom deals with the government and failed finance companies PGC's share price would be much healthier for it.

Kerr should stay in Eastern Sydney.

If it was a fair world George Kerr would be held accountable for many of his actions at PGC, SCF and Torchlight, etc. But because he is a blue blood and is well connected he will be left alone to retire in Sydney with the few millions he has left in his trust accounts.

What would have been the result if George wasn't a blue blood ?

I think we all know the answer.

Yip - funny that George is offshore trying to sell Perpetual. Absolutely confirms then that there are no Kiwi buyers.

If you are sitting in Sydney (or even further offshore) on the bid to buy this baby then you might want to ask yourself why no one closer to home was keen!

Anything connected with George Kerr and his lackey, Mogridge, has a stench which will not go away.

Maybe he will get lucky overseas because the stench may not have spread that far - yet.