Collins and Leahy

Listing for NG's Collins and Leahy

The P-NG Highlands-based com pany, Collins and Leahy Pty. Ltd., is to offer a shareholding to New Guineans following its listing on Australian stock exchanges, which is expected in August. The company is being listed as Collins and Leahy Holdings Ltd.

The prospectus shows that the interests of Mr. Edgar Dowse Collins and Mr. Daniel Joseph Leahy (jnr.) in Collins and Leahy Pty. Ltd., the operating company and its sub sidiaries, were purchased by the new holding company for a consideration of $1,500,000.

The group operates 61 trade stores throughout the New Guinea High-

lands, two butcher shops, a cordial factory, a transport division with a fleet of 60 vehicles, all at Goroka, the Kundiawa Hotel, Kundiawa, and the Zokozoi Hotel, Goroka. A 51 per cent, interest is held in the Kerowagi Tavern, at Kerowagi.

The group’s history dates back to 1958 when Mr. Collins and Mr. Leahy (jnr.) entered into partnership.

During the past five years the group’s net profit after tax has grown from $245,000 to an estimated $340,000 for the financial year to June 30, 1971.

An issue, mainly to Australian investors of 900,000 shares at 50 cents each has just been completed.

It was underwritten by William Tilley, Hudson, Evans and Co., members of the Sydney Stock Exchange. Paid capital is now $1,250,000.

The report of the investigating ac countants, Price Waterhouse and Co., of Port Moresby, said that the object of the issue was to provide cash to partly pay the vendors.

They said that the holding company purchased what is now the subsidiary, Collins and Leahy Pty. Ltd., for $1,500,000.

The vendors were E.D.C. Pty. Ltd. and D.J.L. (Jnr.) Pty. Ltd. The amount due to each was $750,000.

As part of the purchase price, Mr. Collins and Mr. Leahy have granted loans of $125,000 each.

Interest rate is 13 per cent. The loans are repayable by the company over five years.

These loans, totalling $250,000, plus the $450,000 from the share issue, add up to $700,000.

The balance of $BOO,OOO of the $1,500,000 purchase price was taken up in 1,600,000 50-cent shares by the vendors.

Mr. Collins and Mr. Leahy will offer 325,000 of their shares or 13 per cent, of the company, to indigenous people of the Territory, at a date to be fixed, the underwriters confirmed.

The total interest of Mr. Collins and Mr. Leahy in the company would then be 51 per cent, compared with 64 per cent, at present.

The directors forecast a dividend of a minimum of 6 cents a share. It is more than twice covered by estimated profits of 13.6 cents a share.

At the issue price of 50 cents each, the shares return a dividend yield of 12 per cent, based on the forecast dividend.

Chairman of the company is Mr.

D. J. Leahy (jnr.), of North Goroka.

Other directors are Mr. E. D. Collins, of North Goroka; Mr. Alec Harold Tryhorn, company buyer, of Goroka; and Mr. George Horace White, merchandise manager, of Goroka.