You are using an older browser version. Please use a supported version for the best MSN experience.

NZME shares slow to fly off the shelf

NZ NewswireNZ Newswire 27/06/2016 Jonathan Underhill

NZME shares didn't trade in the first hour after listing at midday on Monday as investors questioned the valuation of the New Zealand print media and radio assets spun off from APN News & Media.

As at 12:58pm, NZME stock was bid at 85 cents while holders were asking 98 cents a share, down from $1.05 they started the session at. The stock listed at $1.

The spun off NZME is a pure-play New Zealand media company, with assets including the flagship New Zealand Herald newspaper, a portfolio of radio stations including Newstalk ZB and the GrabOne daily deals site.

APN's shareholders overwhelmingly backed plans to split off the New Zealand unit as a standalone listed company via a distribution of shares to existing investors. The move frees up APN to focus on Australian radio and outside advertising business, while NZME can pursue its merger with rival Fairfax New Zealand.

"There are pros and cons. A traditional media business is more likely to trade on lower multiples," said Shane Solly, a director at Harbour Asset Management. "Others are saying this is a great exposure to the New Zealand economy."

NZME chief executive Michael Boggs fronted investors briefings in Sydney and Melbourne and local institutions have also been given presentations.

But major New Zealand brokerages including Craigs Investment Partners said they hadn't been briefed. Less than 1 per cent of NZME shares are currently held by New Zealanders, meaning there was "a huge opportunity" for local investors to get involved, Boggs told the NZ Herald newspaper.

The listing comes in the wake of the Brexit vote, which slashed trillions of dollars off the value of global markets, although the New Zealand market was relatively unscathed. The S&P/NZX 50 Index was recently down 0.6 per cent having fallen 2.3 per cent on Friday.

image beaconimage beaconimage beacon