Archive | Pyne Gould

Pyne Gould-related Lantern sells pubs but strikes buyer conflict on one

Lantern Hotel Group, an ASX-listed business 37% owned by NZX-listed Pyne Gould Corp Ltd, has sold 2 hotels in the last 3 weeks, encountered a sale double-up on a third hotel last Friday and will put a resolution to shareholders at its annual meeting next Tuesday, 25 October, enabling it to sell the whole portfolio of 8 pubs.

The board said this didn’t mean it would wind up its operations: “The resolution is intended to give the Lantern board flexibility to consider & pursue all options available to it, including if the board receives offers for all of the core properties.”

Pyne Gould – still listed on the NZX although its business interests are in Australia & the UK, and it wants to list in London – holds its shareholding in Lantern through the Torchlight Fund LP & Torchlight GP Ltd. Torchlight said it supported Lantern’s strategy of creating long-term value by acquiring & operating freehold pubs and buying back shares below net asset value, but the strategy changed last year with a programme to sell non-core pubs.

Lantern said in its annual report this programme had been very successful. From November through to August, it had sold or contracted to sell 7 hotels & a parcel of vacant land for a gross $A43 million at a 14% premium to June book value. In the space of 6 months it had halved gross debt to $A40 million and got net debt down to $A28 million.

Lantern said on 19 September its board had formed the view, after a strategic review, that it should sell down its remaining hotel portfolio.

Chair Graeme Campbell & chief executive John Osborne said yesterday Lantern had entered contracts to sell the freehold & business of the Commodore Hotel in North Sydney for $A14.5 million, which represented a 46.5% premium over the 30 June book value, and the process was underway to sell the Brisbane Hotel in Perth.

In September, the company entered into a contract to sell the freehold of the Central Hotel in Bundaberg for $A1.95 million, 22% below the 30 June book value. The board determined that “meeting the market for this asset would yield a superior financial outcome than investing further and waiting for the local market to recover”. Lantern expects that sale to be completed in December.

Cairns council trumps one sale

Last Friday, the Cairns Regional Council cast doubt on the group’s $A6.25 million sale of the freehold & business of the Courthouse Hotel in Cairns, announced in July.

Lantern had expected that transaction to be completed this month, subject to Queensland Government liquor & gaming approvals. However, the council said in a release last Friday it had resolved to acquire the heritage-listed building “with the objective of creating an art gallery & cultural precinct in the cbd”.

Lantern said it hadn’t received any formal notification from the council about compulsorily acquiring the hotel. However the mayor, Bob Manning, said the council had submitted an expression of interest when Lantern put the building on the market, and was surprised to learn of the sale when the expressions of interest process was still underway.

Cllr Manning said: “We want Cairns to become known as the arts capital of Northern Australia. The opportunity to bring this historic, centrally located building into public ownership for this purpose is one we felt needed to be acted upon. The property adjoins 2 other heritage buildings – the former Cairns Public Office building, now inhabited by the Cairns Regional Art Gallery, and the former Mulgrave Shire Council building.

“Together, these 3 buildings represent a significant piece of our city’s history and would provide an ideal location for the expansion of our cultural facilities. Most importantly, 3 of the city’s heritage-listed assets will be retained in public ownership and available for the use & enjoyment of public & visitors alike.”

Cllr Manning said the council had previously identified the hotel as a strategic acquisition for community purposes: “We had intended to purchase the property through regular commercial channels but were never given the opportunity to do so. That is why we have made this decision to implement our right to acquire the property for community use.”

The mayor’s own business dealings were under the spotlight early this year, ahead of his re-election. Cllr Manning & his wife bought the Events NQ business shortly after his election as mayor in 2012, but the business folded in early 2015. Cllr Manning blamed his focus on the mayoralty, and diagnosis of his wife with breast cancer while she was running the company, for letting the business slide.

Earlier story:
31 August 2016: Unrealised gains lift Pyne Gould

Attribution: Company & council releases.

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Unrealised gains lift Pyne Gould

Former Canterbury stock & station agent Pyne Gould Corp Ltd – still listed on the NZX although its business is now in the UK & Australia and it wants to be listed in London – reported a financial turnaround yesterday based mostly on non-cash movements in foreign currency reserves.

The company got another ticking off from NZX Regulation for filing its annual results late (by a day), but issued a more positive report, although it remains embroiled in litigation.

Managing director George Kerr said it turned from a total comprehensive loss of £22.22 million for the June 2015 year to total comprehensive income of £8.78 million this year. That was after an £8.93 million unrealised gain from the foreign exchange translation of foreign associates & subsidiaries, compared to a £15.427 million unrealised loss from foreign exchange translations in 2015.

At the operating level, Pyne Gould recorded a £7000 net loss after tax (a £6.789 million net loss in 2015). Its basic & diluted loss/share went from 2.37p to 0.82p. After allowing for non-controlling interests, the company said net tangible assets/share rose from 26.61p to 26.84p.

Mr Kerr said in his report: “PGC remains focused on patiently executing on its long-term strategy of exiting non-core assets and building a long-term business from distressed assets. The exit of non-core assets is largely complete. The material residual receivable arose from the exit from Perpetual Trust Ltd. This receivable has been independently valued at $NZ20.88 million.”

The core strategy is to commit to the growth of the Torchlight Fund LP, but that’s changed since last year too with the sale of one of its 3 main investments, an 11% stake in UK newspaper group Local World, acquired in 2012 for £7.5 million and sold last year for 4 times the price. Mr Kerr said Pyne Gould transferred the cash consideration from the sale to Torchlight Fund LP and into Australian dollars, which had since risen 20% against the pound.

The other 2 main investments are Melbourne-based residential land investor & developer Residential Communities Ltd, which had a landbank of about 6000 sites in 17 projects and develops & sells about 10%/year, and a cornerstone shareholding in ASX-listed Lantern Hotel Group, a Sydney-based freehold hotel group with net assets of more than $A100 million. Torchlight supports Lantern’s strategy of creating long-term value by acquiring & operating freehold pubs and buying back shares below net asset value.

The most significant event of the year for Residential Communities was in progressing a plan change at Jacks Point in Queenstown: “The first stage of this project was recently released to the market, with all 100 sections selling in line with list prices on the day of release. The near-term focus within RCL remains on continuing to progress this project.”

As for the “large & complex litigations” PGC & subsidiaries have been involved in, Mr Kerr said: “This is an unwelcome, but necessary, requirement of defending the balance sheet of PGC. We devote considerable resources to this part of the business and fully expect our position to be validated by the courts in all cases.”

Attribution: Company release.

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Propbd on Q Sun10May15 – Kerr v Barnes stoush, NZF chooses cleanest exit, Warehouse bond, Warehouse Q3 sales up

Kerr presents $22 million-plus demand and Barnes rejects it
NZF board opts for voluntary administration
New Warehouse bond offer
Warehouse Q3 sales up 4.3%

Kerr presents $22 million-plus demand and Barnes rejects it

Pyne Gould Corp Ltd (headed by George Kerr, now of London) said on Friday it had demanded $22.2 million to finalise its sale of Perpetual Trust Ltd to Bath Street Capital Ltd (Andrew Barnes).

Bath Street promptly rejected the demand.

Pyne Gould said: “In addition to the consideration received by Pyne Gould at the completion of the Perpetual Trust sale in January 2014 ($12.344 million, as previously announced), the sale agreement provided for further consideration payable to Pyne Gould on the occurrence of certain corporate events. There was no floor & no cap on this further amount.

“In April 2014, Pyne Gould and interests associated with Bath Street agreed a variation providing that, in consideration for a payment to Pyne Gould of $22.2 million, the further consideration obligation to Pyne Gould under the previous arrangements would be extinguished.

“Pyne Gould’s view, based on the agreement, is that the payment is due. As it has not yet been received, Pyne Gould has now formally requested payment of the $22.2 million, plus interest & costs, from Bath Street and will pursue that.

“Pyne Gould expects to fully recover the $22.2 million. However, for the purposes of the 31 December 2014 half-year accounts, it was revalued to $19.3 million by independent valuer Grant Thornton. With Grant Thornton’s recent appointment to be Pyne Gould’s auditors, Pyne Gould will appoint a new independent valuer to consider the matter should the amount still be outstanding at 30 June 2015.”

It took a bit more work than Mr Kerr has outlined to get to that point, as you can see from my 1 February story (link below). I wrote in February from notes to Pyne Gould’s June accounts: “Receipt of the money depended on the purchasers of Perpetual Trust Ltd, Bath Street Capital Ltd & Andrew Barnes, listing the shares of a newly incorporated company on the NZX main board. The listing didn’t happen.”

While Mr Kerr said the $22 million was classified as a receivable in the June 2014 accounts, its appearance in the income statement as a gain on disposal turned it into real dollars. In January he said: “Given the current status of the outstanding amount, as at today’s date, it will be reclassified in PGC’s accounts to 31 December 2014 (due for market release by the end of February) as ‘an available for sale financial asset’.”

Bath Street said on Friday the price wasn’t set, but would be up to $22 million depending on the price:earnings multiple at which a subsidiary company was listed.

Bath Street said the subsidiary had continued to evaluate listing, but there was no timetable for this event in the agreement with Pyne Gould.

Earlier stories:
1 February 2015: PGC fesses up over conditional, non-existent profit
17 January 2014: Pyne Gould completes Perpetual sale

NZF board opts for voluntary administration

NZF Group Ltd’s board said on Friday it had resolved to initiate the process to place the company in voluntary administration.

The deal the board had hoped to use for a reverse takeover fell through at the end of April when “internet of things” company Inventory Technologies Ltd resolved not to proceed.

Chairman Sean Joyce said that, since then, the board had been considering options to expedite a timely distribution of funds to the holders of NZF capital notes.

After taking specialist advice, the board felt voluntary administration was the best course. Mr Joyce the board was discussing that with an independent specialist and a formal appointment was expected within 10 days.

Earlier stories:
29 April 2015: Propbd on Q W29Apr15 – Kirkcaldie’s loss, new levy on SkyCity, Allied Farmers placements, Argosy revaluation & sale, NZF deal falls over
11 March 2015: Inventory Technologies raises capital ahead of proposed NZF reverse takeover
7 August 2014: Propbd on Q Th7Aug14 – NZF decider lacks quorum, QV sees value slowdown, 3 apartments sell, all passed in at Barfoots

New Warehouse bond offer

The Warehouse Group Ltd announced an offer of 5-year unsecured, unsubordinated, fixed-rate bonds on Friday to refinance its $100 million senior bond maturing on 15 June and for general corporate purposes.

The retailer will seek up to $100 million, and oversubscriptions taking it to a maximum $125 million. The $75 million general offer will be open to institutional investors and members of the public resident in New Zealand, and a $25 million exchange offer will be made to NZ-resident holders of the maturing bonds.
The Warehouse expects the interest rate to be set though a bookbuild on Tuesday 19 May, in an indicative range of 5.30-5.55%/year, and the offer to open the next day.

Warehouse Q3 sales up 4.3%

The Warehouse said its third-quarter sales were up 4.3% on a year earlier, and same-store sales grew in all 4 retail categories:

  • The Warehouse (red sheds), same-store up 3.3%, total up $14.1 million (3.8%) to $381.1 million
  • Warehouse Stationery (blue sheds), same-store up 2.1%, total up $2 million (2.9%) to $70.2 million
  • Noel Leeming, same-store up 0.9%, total up 5.4% ($7.9 million) to $154.8 million
  • Torpedo7, total sales up 8.5% ($2.4 million) to $30.6 million

Overall sales rose from $610.3 million to $636.7 million (but the company dropped $1.6 million off this figure).

Attribution: Company releases.

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PGC fesses up over conditional, non-existent profit

Pyne Gould Corp Ltd confessed on Thursday that it still hadn’t received $22 million of the $26.6 million it reported as net profit in its 2014 accounts.

The $22 million was always a conditional payment and was recognised as such in notes to the accounts. But that recognition stayed in the notes. On the income statement, it was registered as a gain on disposal of discontinued operations.

Receipt of the money depended on the purchasers of Perpetual Trust Ltd, Bath Street Capital Ltd & Andrew Barnes, listing the shares of a newly incorporated company on the NZX main board. The listing didn’t happen.

Pyne Gould managing director George Kerr told the NZX on Thursday: “As at the date of this announcement, no money has been received. PGC has made an inquiry as to the likely timing of payment, and has now received a response that does not indicate any particular timeframe for receipt of the consideration amount. The outstanding amount and its status will be pursued through the appropriate channels.”

While Mr Kerr said the $22 million was classified as a receivable in the June 2014 accounts, its appearance in the income statement as a gain on disposal turned it into real dollars.

“Given the current status of the outstanding amount” – or, in reality, what was always its true status, conditional possible income – Mr Kerr said that, “as at today’s date, it will be reclassified in PGC’s accounts to 31 December 2014 (due for market release by the end of February) as ‘an available for sale financial asset’. As such it will be measured at fair value by an independent valuer. The impact of this on PGC’s net profit after tax for the year to 30 June 2014 will be reported once this valuation is complete.”

Pyne Gould announced the conditional sale of Perpetual in December 2013 and completed it in January 2014. The deal included an ability for Pyne Gould to benefit by up to 40% of the value created from future corporate events relating to Perpetual.

Attribution: Company release.

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Propbd on Q Th9Oct14 – 2 apartments sell, 3 sales at Colliers auction, Kirkcaldie’s settles sale, Dorchester at 60%, PGC suspended

2 apartments sell at Ray White’s
2 warehouses & childcare centre sell
Harbour City Centre sale settled
Dorchester at 60% in Turners takeover
Pyne Gould suspended

1.50pm:
2 apartments sell at Ray White’s

2 apartments were sold under the hammer and 2 passed in at Ray White City Apartments’ auction today. Auction results:

Eden Terrace, 12A Couldry St, sold for $550,000, sales agents Rita Herceg & Alex Allan
The Rodney, 109 Vincent St, unit 2A, sold for $175,000, Tim Warmington
Prince Albert, 41 Albert St, unit 4F, passed in at vendor bid of $750,000, Tanya Kwasza
96 on Symonds, 96 Symonds St, unit 707, passed in at $260,000, Rita Herceg & Alex Allan

2 warehouses & childcare centre sell

2 warehouses and a childcare centre were sold under the hammer at Colliers International’s auction today. Auction results:

Mt Wellington, 8-10 & 12 Hannigan Drive, sold for $3,752,500, sales agents Paul Higgins & Dwayne Warby
Te Atatu, 2 Waipani Rd, sold for $3.355 million, Peter Kermode & Shoneet Chand
Sandringham, 37 Leslie Avenue, sold for $2.14 million, Jonathan Lynch & Peter Kermode
Albany, 10 Canaveral Drive, unit 5A, passed in at $320,000, Janet Marshall & Nick Recordon
Albany, 10 Canaveral Drive, unit 5D, passed in at $250,000, Janet Marshall & Nick Recordon
Mt Wellington, 18 Hannigan Drive, withdrawn from auction, Andrew Hooper & Ash Vincent
Albany, 10 Canaveral Drive, unit 5C, withdrawn from auction, Janet Marshall & Nick Recordon
Silverdale, 23-25 Wainui Rd, auction postponed until Thursday 16 October, Euan Stratton & Deborah Dowlin
209 Federal St, auction postponed until Wednesday 12 November, Oscar Kuang

Harbour City Centre sale settled

Kirkcaldie & Stains Ltd settled the $45.85 million sale of the Harbour City Centre in Wellington to Harbour City Centre Ltd (Chao (Charlie) Zheng) on Tuesday.

Kirkcaldie’s chairman, Falcon Clouston, said the company also repaid its $23.5 million loan facility from Westpac NZ Ltd.

Dorchester at 60% in Turners takeover

Acceptances of Dorchester Pacific Ltd’s takeover of Turners NZ Ltd reached 60% yesterday.

Earlier story, 19 September 2014: Dorchester offers shareholders opportunity to maintain stakes post-takeover

Pyne Gould suspended

NZX Regulation suspended trading in Pyne Gould Corp Ltd shares this morning after the company had still not filed its annual report in the 5-day period of grace from the 30 September filing date.

The share price dropped from 46c on 15 September to 36c on 3 October, but was at 38c yesterday.

Pyne Gould managing director George Kerr said yesterday the final audited full-year accounts & annual report were still a week away. He said the company was sorry the trading halt might be imposed, but added that the week’s notice of that prospect hopefully meant shareholders wouldn’t be too inconvenienced.

“As we said last week, Pyne Gould has been unable to file its annual report & final audited full-year accounts due to a delay in the completion of the audit relating to one of the Torchlight Fund’s larger underlying property investments not being completed. Every effort is being made to prepare the accounts for their final release.”

Pyne Gould has also not confirmed a date yet for its intended shift to a listing on the London Stock Exchange.

Attribution: Auctions, company releases.

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Pyne Gould ruckus in ‘he said-he said’ mode

Investors in Pyne Gould Corp Ltd may be ruing their decision to stay with the company on its journey from an NZX listing to a UK listing, now that it’s embroiled in a battle with offshore – but Kiwi-led – partners.

Pyne Gould – once a stock & station agent, more recently a finance sector player which got burned and now “a wealth management business focused on investments in Australia & the UK” – fired off a letter to shareholders & the NZX on Monday claiming the directors of a UK (but Bermuda-incorporated) company in which it holds 27% of the shares, Equity Partners Infrastructure No 1 Ltd (Epic), were effectively short-changing their investors.

Epic chairman Murray Tonkin – a director of HealthAlliance NZ Ltd and former chief financial officer of Auckland International Airport Ltd & Foodstuffs (Auckland) Ltd – responded with a very different picture.

Mr Tonkin said Epic’s funds ran out in July, Pyne Gould offered financial support which included getting a board seat, and Epic rejected that in favour of London financing (and no board seat).

Pyne Gould managing director George Kerr claimed in his letter Epic’s other 2 directors, Mick Carolan & Andrew Gartshore, had agreed to a placement at 30p/share, and that another buyer at the same price was controlled by a friend of Mr Gartshore.

Mr Kerr has requisitioned a meeting of Epic shareholders to vote Mr Carolan & Mr Gartshore off the board, replacing them with himself & fellow Pyne Gould director Russell Naylor. Mr Kerr also proposed lifting Pyne Gould’s Epic stake from 27% to 49%, but hasn’t put a price on any offer.

Mr Carolan, who was managing director at Macquarie Securities (NZ) Ltd until 2007, was also a Pyne Gould director, briefly, resigning on 7 July.

Mr Gartshore, who left Auckland University with maths & structural engineering degrees, graduated from the London Business School with an MBA and has held a number of important business & finance roles in London – at Citigroup’s real estate private equity arm, originating, executing & implementing Active Asset Investment Management Ltd’s global acquisitions & disposals, as transaction leader in Bechtel Enterprises’ structured finance & principal investment group, and at the £2.5 billion London Underground Public Private Partnership (Tubelines). In Sydney with Macquarie Infrastructure Partners, he focused on real estate investment opportunities in Australia, New Zealand & the US.

Links:
Equity Partners Infrastructure No 1, including latest updates
Stuff, article by Fairfax business bureau deputy editor Tim Hunter 21 August 2013: Caribbean cruise an Epic gamble for investors

Attribution: PGC releases, Equity Partners correspondence.

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Pyne Gould tries to rein in UK investment manager as Van Eyk stumbles into administration

Pyne Gould Corp Ltd made 2 propositions yesterday to rein in a company which manages one of its English assets. Meanwhile Van Eyk Research Pty Ltd, an Australian company which Pyne Gould exited in February, went into voluntary administration on Monday over a separate asset management issue.

Pyne Gould made an offer to lift its stake in Equity Partners Infrastructure Co No 1 Ltd (Epic) from 27% to up to 49%, and managing director George Kerr proposed that he & fellow Pyne Gould director Russell Naylor replace 2 of Epic’s 3 directors, leaving just independent director Murray Tonkin to continue. Mr Gould has asked for a special meeting to vote on it.

He said the company needed to reduce heavy administration costs and instead focus on minimising debt & creating shareholder value.

“Epic is a simple company with a single investment – a minority (17%) stake in Moto, the UK’s largest motorway service area company, which has excellent prospects as the UK economy recovers and Moto navigates the restructuring of its balance sheet.

“In the interim, however, Epic’s own debt & costs need to be kept to a minimum. Pyne Gould has serious concerns that these are getting out of control. We know other Epic shareholders share these concerns.

“Requesting board changes is an unusual step but it has been triggered by our concern over Epic’s recent announcement that it has arranged a loan of about $10 million for working capital purposes.

“What was not disclosed to Epic shareholders was that this loan from Deutsche Bank has charged all the assets of the company. There has been no coherent explanation provided as to why the entire company has been put at risk to fund operating costs, which appear to be predominantly payments to directors.

“We do not believe that this level of costs is required to run Epic over the next few years, given Epic’s size and that it is a non-trading holding company with a single investment. Borrowing $10 million for 3 years’ working capital is not, in our view, justifiable or prudent.”

The formerly Christchurch-based & NZX-listed Pyne Gould, now based in Guernsey, has been reviewing its timetable for listing in London and Mr Kerr expected to make an announcement at the time of its annual report, to be distributed by the end of September.

Pyne Gould sold 3 Perpetual companies to Van Eyk in early 2013 and also sold its 27% stake in Van Eyk, settling the final part of the transaction in February.

The Perpetual companies have been rebranded – Perpetual Portfolio Management is now van Eyk Advice NZ and Perpetual Asset Management is Blueprint Investment Management.

The trouble at Van Eyk that led to administration concerned a $31 million investment by one of its funds, through London hedge fund the Artefact Group in 2012. Van Eyk & its responsible entity, Macquarie Investment Management Ltd, revealed on 6 August that the $A95 million Blueprint international shares fund couldn’t make redemptions because of this illiquid investment.

By 4 September, Macquarie had been forced to close 13 of the 14 funds in the Blueprint series. On Monday, Trent Hancock, director of accountancy firm Moore Stephens’ Sydney corporate recovery group, was appointed administrator.

Attribution: Company releases, Australian media, Pyne Gould reports.

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Kerr presents confident outlook for transformed PGC

Pyne Gould Corp Ltd (PGC) made $20.1 million (9.5c/share) net profit after tax for the June year, down 55%, as it continued its journey from the New Zealand sharemarket towards a London listing.

The formerly Christchurch-based company, now based in Guernsey, “is now reviewing its timetable for listing in London and expects to make an announcement at the time of its annual report, which is to be distributed by the end of September,” managing director George Kerr said on Friday.

The company is becoming trimmer, but with great expectations. It made a $2.4 million loss from ordinary activities, a 110% worse result, on revenue down 81% at $8.2 million.

The bottomline return reflected a 16% gain in net tangible assets, from 64c/share ($137 million) to 74c/share ($153 million).

But, as usual since Mr Kerr took control of an ailing long-established company and began to turn it upside down, the transformation and the hopes for a company growing through offshore business ventures are the interesting aspects of Pyne Gould at the moment.

In his preliminary result report on Friday he talked of simplifying the group, selling non-core assets and reinvesting in the core business in Australia & the UK. The $20.8 million bottom line was derived from “a profitable core fund management business and a substantial gain on the exit from financial services, after significant one-off costs.

“Torchlight contributed $5.8 million before non-cash foreign exchange accounting adjustments, which reduced this to $3.1 million. The full net profit after tax results were largely attributable to the positive one-off impact from the sale of Perpetual, and reduced by the legal & other costs associated with transactions, regulatory compliance & migration.”

At 30 June, Pyne Gould held total assets of $159.8 million and total liabilities of $5.9 million, with a net position of $153.9 million. It has no bank debt.

Current assets are $49.3 million ($42.1 million last year), with current liabilities $5.9 million ($14.1 million), giving net current assets of $43.4 million ($29.3 million). Long-term assets total $110.4 million, with no long-term liabilities.

Pyne Gould holds $59 million in Torchlight Fund LP interests & $33 million of co-investments. Over the course of the financial year, Torchlight Fund LP acquired ownership of almost 100% of the assets of Melbourne-based residential land investor & developer Residential Communities Ltd, which has a landbank of about 6000 sites in 17 projects. It develops & sells about 10%/year.

Torchlight Fund LP is also the cornerstone shareholder of ASX-listed Lantern Hotel Group, a Sydney-based freehold hotel group with net assets of more than $A100 million. Torchlight supports Lantern’s strategy of creating long-term value by acquiring & operating freehold pubs and buying back shares below net asset value.

Torchlight Fund LP’s other assets include an 11% stake in UK newspaper group Local World, acquired in 2012 for £7.5 million). Mr Kerr said the UK economy, the newspaper sector & the pound sterling had recovered strongly since then, leading to a positive outlook for the investment. “Local World is creating value through both cost-cutting & growth in digital advertising.”

Pyne Gould’s other long-term assets include an $18 million stake in Equity Partners Infrastructure Co No.1 Ltd (Epic – 42 million shares, or 26.9%), which owns about 17% of Moto, the largest motorway service area owner & operator in the UK. “We have a positive long-term view of this investment,” Mr Kerr said.

Pyne Gould spent $3.85 million buying back about 4% of its shares last year and has a target of buying back 30 million shares, or 15% of the stock on issue, this year.

Summing up the business after 5 years of transformation, Mr Kerr said: “With the exception of Local World, the principal direct & indirect investments are all, at their core, large & valuable real estate businesses. Each has a strong real estate-based business model and a high quality management team.

“In Australia, Torchlight’s RCL has a significant landbank that is being continuously developed, sold & restocked. The investment — made via distressed debt, consolidated & converted into equity ownership — has become a material engine for free cashflow.

“Similarly, the cornerstone shareholding in Lantern Hotel Group was built up in distressed market conditions and now has strong earnings prospects from a large freehold pub portfolio nearing the end of a major refurbishment cycle.

“In the UK, Epic initially invested in Moto at a distressed market valuation during the depths of the global financial crisis in 2009. This investment requires particular patience & discipline to unlock the quality cash earnings from owning & operating a substantial real estate portfolio of motorway service areas. Like RCL & Lantern, Moto is expected to create significant long-term shareholder value.

“PGC is well ahead of its restructuring objectives and is highly confident in both the financial strength & strategic direction of the company. As a consequence, PGC is considering the restoration of a policy of regular dividend payments within the next year. This topic will be addressed in the annual report.”

Attribution: Company release.

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Pyne Gould completes Perpetual sale

Pyne Gould Corp Ltd has completed the sale of Perpetual Trust Ltd and now has no significant operating assets left in New Zealand.

Pyne Gould announced the conditional sale of Perpetual to interests associated with wealth management investor Andrew Barnes in April 2013. The Overseas Investment Office approved the sale in December.

The final base consideration was $12.344 million, made up of $6.244 million for 100% of the equity & shareholder advances, $3.9 million of debt taken over and $2.2 million for an in specie property distribution.

Pyne Gould will also be able to benefit by up to 40% of the value created from future corporate events relating to Perpetual.

NZX-listed Pyne Gould’s shareholders voted overwhelmingly in December in support of the company’s migration to Guernsey as a prelude to seeking a listing on one of the registered markets operated by the London Stock Exchange.

Attribution: Company release.

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Pyne Gould gets overwhelming support for move to Guernsey

NZX-listed Pyne Gould Corp Ltd’s shareholders gave overwhelming support yesterday for the company’s migration to Guernsey as a prelude to seeking a listing on one of the registered markets operated by the London Stock Exchange.

The votes in favour of 2 special resolutions exceeded 98%.

Chairman Bryan Mogridge said the company would seek a listing on the London Stock Exchange in the first half of 2014.

Pyne Gould proposed the move a month ago, when Mr Mogridge said the company had no material investments or assets remaining in New Zealand: “Its current significant investments (through the Torchlight Investment Group) are in businesses that operate in Australia & the UK.”

Attribution: Company release.

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