The New Zealand stock exchange will not cancel almost
$150,000 worth of trades in Lyttelton Port of Christchurch
(LPC) shares which occurred this week, immediately after Port
Otago announced it was selling its 15.5% blocking stake in
its northern rival.
Once the market was made aware by Port Otago of the takeover
offer, made by 80% LPC shareholder the Christchurch City
Council, in a ''substantial security holder'' notice, the
shares were driven up 24% to $4.10, but there were 13 trades
well below $4.10.
These included ''open orders'', which are automatic triggers
to buy or sell shares once a pre-set price is struck.
The NZX market update yesterday said ''In relation to LPC,
NZX is confident that all market participants, traders and
investors ... had access to the same information at the same
time in relation to the proposed takeover of LPC''.
Port Otago reaped a 77% gain on its 2006, $37 million
acquisition of a takeover-blocking stake in LPC, having in
recent weeks agreed with Christchurch council to lock in the
share sale for $65.7 million, which included about $3 million
in a special dividend on top of the $3.95 per share takeover
The NZX noted while it was ''unusual'' that listed LPC was
not aware of the takeover, neither Port Otago nor the
Christchurch council were listed companies and had no
obligation to release information, other than the substantial
security holder (SSH) notice.
Normally, a takeover offer prompts the NZX to halt trading in
shares, before its release.
The NZX said yesterday it ''did not become aware of the
significance'' of the Port Otago SSH notice prior to
publishing it , but when it did, the NZX immediately halted
trading in LPC shares.
Trading resumed after the Christchurch council's takeover
offer was received.