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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 offer.
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.