The future of Allan Hubbard's majority shareholding in New Zealand Wool Services International is creating some uncertainty, as the company reports a hostile approach from a competitor wanting to buy its wool scour assets.
Interests associated with Timaru businesspeople Allan and Jean Hubbard, who have several companies in receivership, own about 65% of Wool Services International (WSI) and the future of the shareholding is in the hands of receivers.
An angry WSI managing director Michael Dwyer yesterday said Cavalier Corporation managing director Wayne Chung had approached him seeking support for an application to the Commerce Commission to buy WSI's scouring assets.
Cavalier owns the country's only other two wool scours and Mr Dwyer said had it bought WSI's scours in Christchurch and Hawkes Bay, it would have created a monopoly and the deal would have struggled to get commission approval. He said the scours were not for sale.
Mr Dwyer described Cavalier's approach as an attempt to use a "frivolous application" to destabilise a successful competitor.
In an interview Mr Dwyer said the wool industry had been rife with false rumours WSI was about to close.
"WSI's recently released half-year result and the special dividend paid to shareholders shows that the company is in a very strong position," Mr Dwyer said.
For the six months ended December 31, the company posted a $3.05 million net profit, compared with a loss of $680,000 a year earlier. It will pay a one-off imputed dividend of 2c a share.
Mr Chung had not responded by last night to an Otago Daily Times approach for comment.
Mr Dwyer said the future of the four lots of Hubbard-owned shares in WSI was a separate issue, but it was creating some uncertainty for the company.
A potential new wool grower co-operative, Wool Partners Co-operative, has expressed an interest to the receivers in buying the Hubbard stake in WSI.
