NEW ZEALAND industrial holding company Brierley Investments is mounting its second foray into publishing in Auckland, with a dawn raid on Wilson and Horton, publisher of the New Zealand Herald. 'Today we are up to 26 per cent of Wilson and Horton,' said Brierley's chief financial officer Herman Rockefeller, in Hong Kong to sign documentation for a US$138 million transferable loan certificate (TLC) facility. 'We did a dawn raid [overnight on Wednesday] while the TLC was being completed. We are seeking to increase that [stake in Wilson and Horton] to 30 per cent.' Mr Rockefeller said Brierley, one of the country's biggest listed companies, was not obliged under New Zealand law to mount a full takeover offer. Based on its NZ$9.50 a share offer, Wilson and Horton's market capitalisation was valued at around NZ$925 million (about HK$4.4 billion). 'We went in and offered institutions and foreign investors a favourable share premium of $9.50 and we have decided to keep that offer open,' he said. The shares were trading at $8.20 before the raid, he said. Brierley wanted to buy another five million shares to lift its total stake to 29 million shares. Based on its offer price, its stake would be valued at $275.5 million. The New Zealand Herald is Wilson and Horton's flagship newspaper and commands the largest circulation in New Zealand. It represents Brierley's second venture into the Auckland newspaper market. In 1987 its wholly owned New Zealand News launched The Auckland Sun, a short-lived tabloid daily newspaper. Meanwhile, Bloomberg reports from Wellington that Wilson and Horton have reminded shareholders who are tempted to sell their shares that the group last week posted an 11.1 per cent rise in profit to $21.4 million for the six months ended September 30. Sales in the half year were $193 million. Wilson and Horton directors also told shareholders that the company's shares had traded at a high of $11.10 this year. The shares traded at a low of $7.20 on October 7, and have not traded above $9.50 since March. Brierley also has major investments in London hotels group Mount Charlotte and Air New Zealand. It said the acquisition of the shareholding was being carried out through its wholly owned subsidiary, Marram Investments. It also owns 50 per cent of fishing group Sea Lord, which has 20 per cent of the country's fisheries quotas. Mr Rockefeller said it was a good time for Brierley to buy into the newspaper. Economic growth in New Zealand was strong, government spending was falling and the country was benefiting from growth in the private sector, so advertising revenues should be strong, he said. Brierley broke up New Zealand News in 1988 and sold parts to Wilson and Horton and parts to Independent News, controlled by Rupert Murdoch's News Corp. Proceeds of the US$138 million TLC signed yesterday were for general corporate funding requirements and not for the newspaper acquisition, he said. Brierley was in good shape, having been upgraded to BBB-by Standard and Poors earlier this year after pruning its debt-to-equity ratio to 25/75 from 50/50 six years ago, he said.
