Asian group grabs 20% of NZ's Brierley

Asian group grabs 20% of NZ's Brierley

WELLINGTON (Reuter): An Asian consortium snatched a 20 percent
stake yesterday in Australasia's largest listed investment
company, Brierley Investments Ltd (BIL).

The raid on the New Zealand firm at NZ$1.40 (US$0.96) a share,
NZ$680 million in total, was all over in minutes with investors
queuing to unload stock at a price 11 percent above the
prevailing level.

Most analysts believe the consortium comprising Hong Leong
Group, Malaysia; Hong Leong Group, Singapore; Salim Group,
Indonesia; Sembawang Corporation Ltd, Singapore; and Haw Par
Brothers of Singapore, paid a high price, if not too high.

"I'm stunned that they would want to go and pay NZ$1.40, I
could understand NZ$1.30," said one.

He believed the group had taken a very optimistic view of
BIL's British hotel chain, Thistle Hotels, which comprises nearly
half of BIL's NZ$9 billion of assets.

The raid was welcomed by BIL as giving the investment company
and sometime corporate raider a cornerstone shareholder. It
immediately offered a place to the group on its board.

"We are delighted," Chief Executive Paul Collins told Reuters.
"We are also delighted to have a strong anchor shareholder."

He said many of BIL 128,000 shareholders were discretionary
investors. "To develop a relationship with a strong anchor
shareholder over time provides a much stronger foundation for us
to grow from."

He said it was a strong recognition of the value within BIL
today and value that could be created in Australia and Asia in
the future.

Analysts and Collins agreed the consortium's investment was
recognition of BIL's increasing involvement in Asia. Already the
Singapore government's investment arm, Temasek Holdings, is a
major shareholder, with a six percent stake bought in 1991.

David Copley of Cavill White said the consortium could have
picked up the stake cheaper but said it have wanted to buy in
hurry. He viewed the move positively.

"It indicates that there is value in the stock and others have
recognized that. It confirms the positive trend since the U.K.
hotel market picked up," he said.

Analysts noted links in the hotel industry between BIL and
Singapore's Hong Leong group which controls CDL Hotels
International.

"With the Hong Leong group in there, you would have to think
there is some possibility of doing something with Thistle,"
Copley said.

BIL has made no secret over recent years that it wants to
reduce its exposure to Thistle, but Collins said that links
between CDL and Thistle were not the driving force behind the
group's investment.

"The key thing we see with these guys is the growth in value
over time," Collins said.

Collins disagreed with some analysts' estimates that BIL is
now around 65 percent foreign-controlled, saying the true figure
was about half. He said much of the 20 percent bought came from
foreign holders.

He rejected a suggestion that the Asian group had invested in
BIL as a defensive play, and that the investment company was now
operating more as a fund manager. "That's certainly not the way
the company is managed. We are managed for growth," he said.