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Comvita deal leads local shares sky high

NZ NewswireNZ Newswire 5/09/2016 Sophie Boot

Manuka honey products are seen at a supermarket in Beijing. © Reuters Manuka honey products are seen at a supermarket in Beijing. New Zealand shares rose, led by Comvita on the back of its plans to take control of its Chinese distribution, while Air New Zealand and Mercury NZ also gained.

The S&P/NZX 50 Index rose 65.73 points, or 0.9 per cent, to 7,491.84. Within the index, 36 stocks rose, 10 were unchanged and five fell. Turnover was $182 million.

Comvita was the best performer on the index, up 6 per cent to $10.60. The New Zealand manuka honey products company plans to acquire 51 per cent of its Chinese distributor in a $30m all-stock deal that will see the owners of Shenzhen Comvita Natural Food Co lift their holding in Comvita to more than 11 per cent.

The deal is expected to be earnings accretive for Comvita in the first year, excluding one-time costs.

Air New Zealand gained 3.3 per cent to $2.35.

Steel & Tube Holdings will drop out of the S&P/NZX50 benchmark index on Sep 16, along with rubber goods company Skellerup.

Agribusiness group Scales Corporation and cinema software developer Vista will replace them.

Vista more the doubled its profit in the first half of its financial year due to increased revenue from acquisitions, while Scales saw net profit rise 3 per cent to $33.8m in its first half. Vista rose 2.9 per cent to $6.80 and Scales rose 3.1 per cent to $3.33.

Steel & Tube shares gained 1.4 per cent to $2.22, while Skellerup was unchanged at $1.36.

Mercury NZ climbed 2.6 per cent to $3.32, Tower rose 2.6 per cent to $1.37, and Spark New Zealand advanced 2.4 per cent to $3.885.

Contact Energy was the worst performer, down 2.5 per cent to $5.05, while Z Energy dropped 0.5 per cent to $8.30.

Orion Health Group dipped 0.2 per cent to $4.08.

Outside the main index, Wynyard Group dropped 4.2 per cent to 23 cents. It's down 87 per cent this year.

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