Bethunes to sell Webb's auction house, plans new investment
Bethunes Investments [NZX: BIL], formerly known as Mowbray Collectables, will sell its Webb's auction house for $800,000 to Australia's Mossgreen, and plans to kick off a new investment programme first signalled at July's annual meeting.
The deal is conditional on the Australian auction house completing due diligence and Bethunes shareholder approval, and is expected to be completed on January 1, the company said in a statement. Bethunes will receive $400,000 upfront, with the balance paid in quarterly instalments over two years, in a deal that's expected to be loss-making.
"Shareholders should note that the purchase price under this proposed transaction significantly exceeds the purchase price and terms that were proposed by potential purchasers earlier this year and prior to BIL completing its capital raising," the company said.
Bethunes changed its name after founder John Mowbray bought subsidiaries Mowbray Bethunes and Wildlife Philatelic for $950,000, leaving the company with auction house Webb Galleries as its sole trading entity, which has since underperformed forecasts.
In July, Bethunes told shareholders it had two overseas parties interested in buying Webb's, which it today said needed "considerable attention" and would be better placed with a recognised auction house.
The company raised $1.54 million in a deeply discounted rights issue last month to restructure the Webb's business and build funds for an investment pipeline in new industries.
Bethunes today said it will start on a new investment programme in other sectors, which Webb's doesn't fit into, and will update the market in the near future.
It had previously told shareholders it had explored opportunities in New Zealand storage and a subset of food processing but hadn't found any suitable investments.
Separately, Chris Swasbrook was appointed chairman of Bethunes, a position he has held as an acting role since July when Murray Radford resigned from the board.
The shares last traded at 1.4c, valuing the company at $1.61 million.