How to lose $22m in 6 months

George Kerr has a reputation for being an astute dealmaker and the following is based on the assumption that it was him and Bryan Mogridge behind the dealing at PGC and Torchlight. Your board under the leadership of Bryan Mogridge is double backing and he is contradicting himself, which ultimately cost PGC shareholders and arm and a leg.

On 4 Nov 2011 Bryan Mogridge tells PGC shareholders it would 
 be “foolish” to sell PGC’s Heartland and PGG Wrightson shares. 

 On 17 May 2012 PGC files to inform the market it sold 9.4m shares for $4.9m or 52 cents per share and so the story begins. We now know that the firesale of Heartland shares were to replace the funds taken from the Perpetual Trust Cash Fund. 

The history of the share sales are below and also what those Heartland shares would have been worth today if Kerr and Mogridge were not forced to sell it in order to replace the funds at the Cash Fund. 

What makes it even worse for George Kerr personally is that his holdings via Pyne Holdings (a personal vehicle of Mr Kerr and not to be confused with Pyne Gould Corp) was sold to ACC (it seems) at the same time and similar prices, which puts him out of pocket to date to the tune of $4.9m. You will note from the following that Mr Kerr's vehicle, Pyne Holdings,  was replaced by ACC on the shareholder register. 

 Curiously the relevant filings on Pyne Holdings on the NZX website had the attachments removed and my email to the NZX about this received no reply.

You will note that the there are no attachments on the filings despite it stating "Please see attached substantial security holder notice for Pyne Holdings Limited in Heartland New Zealand Limited"

I wonder how shareholders in general and those supposedly sophisticated investors like Baobab and Baker Street Capital Management must feel about this rapid value destruction. Vadim Perelman from Baker Street Capital Management is joined at the hip with George Kerr through their bidding vehicle AEP and I wonder how comfortable he can feel about that, because he gave up control of AEP to Mr Kerr.

At the end of the day it all adds up. Torchlight's value destruction over the last few months is $8m and between Pyne Holdings and PGC the Heartland shares leaves Mr Kerr out of pocket for a total -$21.7m!

So, can we consider George Kerr to be an astute deal-maker? The facts seem to indicate the title does not fit.

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Cheerio!

jA

Anderson Cooper once said, I think it's a good thing that there are bloggers out there watching very closely and holding people accountable. Everyone in the news should be able to hold up to that kind of scrutiny. I'm for as much transparency in the newsgathering process as possible.