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CBL managers, director get $65m payday

NZ Newswire logoNZ Newswire 4/04/2017 Jonathan Underhill

CBL Corp's managing director Peter Harris, deputy chair Alistair Hutchison and senior managers have sold 8.5 per cent of the specialist insurance company - 20 million shares - after a restriction on their holdings lifted.

The shares were sold in a block sale to Australian and New Zealand investors at $3.26/A$3 apiece, the company said on Wednesday.

The shares were halted for the sale, which will generate $65 million. The price is a discount of 8.9 per cent to the last trading price on the NZX of $3.55.

Mr Harris sold 5 million shares for a gain of $16.3m, while Mr Hutchison sold 5.4 million shares for a $17.6m gain. Senior managers sold 9.6 million shares, meaning they will share in a $31m payday.

Mr Harris's holding has reduced to 22.8 per cent from about 25 percent, while Mr Hutchison's declined to 19.5 per cent from 21.8 per cent.

The company released a statement to the NZX with a headline that the sale of 8.5 per cent of the stock was to increase share market liquidity.

"Advice from our advisers suggests this transaction will provide additional liquidity in the market for CBL shares which we believe will benefit all shareholders," said chairman John Wells.

The company has about 236 million shares on issue and at yesterday's closing price had a market capitalisation of $837m.

Last month, CBL said it expected underlying operating profit to rise by between 18 per cent and 22 percent in calendar 2017 on revenue growth of 12 per cent to 16 per cent.

CBL listed on the NZX in 2015, raising $90m to help fund the acquisition of Australia's largest surety bond insurer Assetinsure.

The company began life as Contractors Bonding Ltd in 1973, and derives the bulk of its revenue from international operations, meaning its bottom line is influenced by unrealised foreign exchange movements.

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