MARKET CLOSE: Shares fall, as Trustpower sale weighs

New Zealand shares fell, paced by power and broadband company Trustpower as a major shareholder reduced itsstake. Spark New Zealand, MightyRiverPower and Contact Energyalso declined.

The NZX 50 Index fell 35.705 points, or 0.6 percent, to 5757.909. Within the index, 25 stocks fell, 16 rose and nine were unchanged. Turnover was $285 million.

Trustpower declined 2.2 percent to $7.90, while $156 million worth of shares changed hands. Shareholder Tauranga Energy Consumer Trust reduced its stake to about 27 percent from 33 percent, selling 20 million shares for $7.74, or $154.8 million. Most of the shares were sold to New Zealand institutions and retail investors, with a small amount bought by Australians. The sale price was a discount to Trustpower's $8.08 closing price yesterday.

"Across a number of names in the New Zealand market we've seen them under pressure today," said James Lindsay, who helps manage about $400 million in equities for Nikko Asset Management New Zealand. "That Trustpower placement is not an insignificant amount for both institutions and for retail investors to fund in a relatively short period of time."

Investors sold down other companies to fund the take up of Trustpower shares. Spark, formerly Telecom Corp, dropped 1.6 percent to $2.80, its lowest level since August. Genesis Energy, the partially-privatised power company, fell 1.8 percent to $2.17. Infratil, which has a 50 percent stake in Trustpower according to NZX data, dropped 1.3 percent to $3.11. Fletcher Building, the construction and building supplies firm, slid 1.7 percent to $8.17.

Further weighing on the market was investors raising cash ahead of Meridian Energy's installment receipt coming due, Lindsay said The energy retailer and generator was listed on the bourse in October 2013, with the shares offered in installment receipts to sweeten the offer, with $1 upfront and the promise of full entitlement to dividends, and the remaining 50 cents due next month. Meridian rose 1.6 percent to $1.88, rebounding after having been sold down to fund the take up of the receipt.

"In that same yield sector, everyone who has that Meridian partial payment to pay as well in the next few weeks is going to have to fund that," Lindsay said. "A lot of retail investors have had big positions in those yield stocks, so there might be a bit of funding related to that. People have to get the cash to pay for the placements."

MightyRiverPower, the government-controlled energy company, fell 0.7 percent to $3.01. Contact, the utility company half owned by Australia's Origin Energy, dropped 1.7 percent to $5.65.

"MightyRiverPower and Contact came out with some operational statistics that both showed a little poorer numbers for the month," Lindsay said. "Operational volumes were down, on a per customer basis, so customers were buying less, and average price achieved was lower as well."

On the New Zealand Alternative Index, Pushpay Holdings was unchanged at $4.55. The mobile payment app developer is looking to raise $13.8 million from its New Zealand-based shareholders via a discounted share offer.

GeoOp soared 44 percent to 65 cents. The workforce management app said annual sales doubled to $1.27 million after a strong pick up in customers in the last month of its financial year.

(BusinessDesk)