Briscoe Group bid rejected but broker report tips prospect of another offer for the outdoor goods retailer

New Zealand shares rose yesterday, led by Kathmandu Holdings on speculation it may be subject to another takeover offer. Ebos Group, Nuplex Industries and New Zealand Refining Co also advanced.

The S&P/NZX 50 Index gained 37.03 points, or 0.7 per cent, to 5630.54. Within the index, 39 stocks rose, six fell, and five were unchanged. Turnover was $75 million, lighter than usual with several states in Australia on a public holiday.

Kathmandu led the benchmark index higher, gaining 4.3 per cent to $1.46. The outdoor goods retailer’s board rejected an offer from sporting goods and homeware chain Briscoe Group, saying the cash and scrip offer, amounting to $1.80 a share, undervalued the company. Rod Duke, Briscoe’s chief executive and controlling shareholder, may make another bid.

Outside the benchmark index, Briscoe fell 0.4 per cent to $2.84.

“There was a broker report out just today that was suggesting Briscoes might come back and have another crack,” said Mark Lister, head of private wealth research at Craigs Investment Partners. “Which is true — they may well do that.”

Wall St rose last week as investors speculated weak data in the United States may see the Federal Reserve keep interest rates lower for longer, a boost for equities.

“There’s certainly positive leads from overseas,” Lister said. “There was a very weak jobs report that came out, which on the one hand is a negative because that’s a key piece of economic data that didn’t look good at all. The market, ironically, might have seen it as positive because they might have seen it as going to keep interest rate rises at bay for some time.”

Ebos, the animal and healthcare business, climbed 2.1 per cent to $12.90. NZ Refining rose 2.1 per cent to $3.47. Nuplex, the resins and chemicals firm, gained 2 per cent to $2.58.

Dividend-paying stocks, such as energy companies and property investors, rose. Precinct Properties New Zealand gained 1.3 per cent to $1.15. Goodman Property Trust increased 1.3 per cent to $1.17. Kiwi Property Group climbed 2 per cent to $1.295. Mighty River Power rose 0.6 per cent to $2.52. Meridian Energy advanced 0.5 per cent to $2.115. Contact Energy gained 0.4 per cent to $4.95.

Improving dairy prices had also calmed investor fears about the domestic economy, Lister said.

Units in Fonterra Shareholders’ Fund, which give access to Fonterra Co-operative Group’s dividend stream, rose 0.6 per cent to $5.28. Metro Performance Glass was the worst performer on the benchmark index, down 2.3 per cent to $1.30.

The value of share trading on the NZX climbed 23 per cent in September, rounding out a quarter when the benchmark S&P/NZX 50 Index posted its biggest three-month decline in more than three years.