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Godfrey Hirst loses court appeal

NZN 8/06/2016 Tina Morrison

Godfrey Hirst's High Court appeal against a merger of New Zealand's largest wool scouring operations was dismissed, allowing the creation of a dominant scourer involving rival carpet maker Cavalier Corp.

The Commerce Commission in November approved a plan for Cavalier Wool Holdings to acquire New Zealand Wool Services International's wool scouring business and assets, saying the public benefits would outweigh the loss of competition.

Australian company Godfrey Hirst, which competes with Cavalier Wool Holdings group member Cavalier Corp, had its appeal against that ruling dismissed, Auckland-based Cavalier Corp said in a statement.

The merged scouring business will be 55 per cent owned by Cavalier, private equity firm Direct Capital and the government's Accident Compensation Corp, with WSI parent Lempriere taking a 45 per cent stake.

"The shareholders of CWH are pleased with the decision and look forward to proceeding with the merger as planned," Cavalier Corp chief executive Paul Alston said in the statement.

Cavalier shares last traded at 66 cents and have gained 8.2 per cent this year.

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