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NZ shares rise, Tower surges on takeover

NZ Newswire logoNZ Newswire 9/02/2017 Sophie Boot
The S&P/NZX 50 Index gained 55.36 points, or 0.8 per cent, to 7,121.63. © Getty Images The S&P/NZX 50 Index gained 55.36 points, or 0.8 per cent, to 7,121.63.

New Zealand shares rose, with SkyCity Entertainment Group gaining following its first-half earnings while Tower soared 42 per cent on a takeover bid.

The S&P/NZX 50 Index gained 55.36 points, or 0.8 per cent, to 7,121.63. Within the index, 24 stocks rose, 16 fell and 10 were unchanged. Turnover was $96.3 million.

SkyCity Entertainment Group led the index, up 6.2 per cent to $3.97. New Zealand's only listed casino company posted an 18 per cent lift in first-half profit.

"There's ongoing growth in Auckland, positive momentum appearing to return and you've got some projects in Adelaide and New Zealand that could be earnings-accretive acquisitions getting closer day by day," said Rickey Ward, NZ equity manager at JBWere.

Against that, "you've got international business which is important to this company showing weakness towards the end of that period, which creates a bit of negativity".

Tower jumped 42 per cent to $1.12. Canada's Fairfax Financial Holdings has offered to buy Tower for about $197 million.

"It's further highlighting that there is value in our market when a lot of us don't believe there is, here's a company that's met difficulties in the past through an event no-one predicted, and the share price didn't fairly reflect the improvement underlying the earnings," Mr Ward said.

"It just highlights again, corporate activity shouldn't be ignored. My guess is investors will prefer a takeover bid over a demerger, because it still has an element of uncertainty about it."

A2 Milk Co rose 4.2 per cent to $2.49, Metro Performance Glass gained 2.7 per cent to $1.54, and Summerset Group Holdings advanced 1.9 per cent to $4.86.

Sky Network Television was the worst performer, down 1.1 per cent to $4.33, while Meridian Energy dropped 0.6 per cent to $2.70 and Contact Energy declined 0.4 per cent to $4.79.

Creditors have placed failed crime-fighting software company Wynyard Group into liquidation, the company announced . Wynyard listed on the NZX in 2013, with investors paying $1.15 a share. The stock closed as high as $3.12 in March 2014 but shares were worth just 21.5 cents when the company eventually went under last October.

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