Rates round-up: September 17
F&P Finance could be on the block; Powerco bonds to repaid; Inflation-linked bonds coming shortly; GFNZ rights issue on again.
Monday, September 17th 2012, 7:05AM
F&P Finance could be on the block
Fisher & Paykel Finance could be up for sale if Chinese whitewear manufacturer Haier succeeds in its takeover bid for its parent company Fisher & Paykel Appliances.
Haier is looking for at least 50% of the company and has mentioned its plans for “the potential divestment of the Fisher & Paykel Finance business” in its takeover notice.
F&P Finance has been a strong performer recently, making up a large chunk of F&P Appliances’ profit during a time when its core manufacturing business has found the going tough.
In the year ended March 31, F&P Finance achieved normalised earnings before interest and tax of $37.8 million, more than three times the earnings of the appliance division ($11.3 million).
F&P expects appliances to bounce back this year with earnings of $35 million to $40 million, and earnings of $35 million to $38 million from F&P Finance, which offers consumer credit products including the Farmers Finance Card and the Q card.
Powerco bonds to be repaid
Utility firm Powerco has announced it will repay the principal as scheduled on its seven-year guaranteed Bond issued on 28 September 2005.
The bond issue attracted $130 million from investors and paid an interest rate of 6.59% per year.
The application date will be on September 28, with the record date on September 18.
Powerco is New Zealand’s second-largest electricity and natural gas distributor by customer numbers.
Inflation-linked bonds coming shortly
Inflation-linked New Zealand government bonds could be back on sale next month, after a long wait for investors since the last such offer was made.
The New Zealand Debt Management Office (NZDMO), which sells our government’s bonds, has appointed a syndicate to help sell the bonds from October 1 depending on "suitable market conditions".
The NZDMO has appointed ANZ National Bank and Deutsche Bank as the joint lead managers, with HSBC and RBS in Australia as co-managers.
The bonds will probably mature in September 2025, it said.
"Inflation-indexed bonds are intended to provide long-term cost-effective funding for the government and to provide investors with a hedge against inflation," the office said.
The NZDMO has said it plans sell up to an annual $2 billion of the bonds in the 2013 and 2014 fiscal years.
It last sold inflation-indexed bonds in 1995 maturing in 2016 and paying annual interest of 4.5%.
Those bonds had an indexation value of $2.05 billion, or 3.3% of the government's total debt outstanding, as at August 31, according to NZDMO figures.
GFNZ's rights issue on again
GFNZ's on again, off again one-for-four rights issue is on again, subject to Takeovers Panel approval of the underwrite and shareholder approval.
The former Geneva Finance said late Friday it needs the panel’s approval because 20% shareholder Federal Pacific Group (FedPac) plans to underwrite the issue aimed at raising $1.5 million.
When the rights issue was first announced in July, GFNZ said depending on the extent of shareholder participation, the underwriting could take FedPac's stake as high as 43.2% by September 2015.
The rights issue was deferred in mid-August because GFNZ said it couldn't get the paperwork completed in time for a vote at the August 28 annual shareholders' meeting. It now plans to call another meeting in early November.
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