Promotion of Accounting Reform as the most effective Pathway to a Fairer Safer and more Prosperous Society. Comment and Support from all quarters is Sought to straighten out NZ's problem
June 2021 Edition
Well another year has gone by. We are still here. We have been concentrating on news media. And watchdog organisations that are designed to see that the media are accurate. Here is the script of a letter to our local paper which focuses on the latest scandal being that of the My Food Bag offering in March 2021.
“Rather than historic discussions about whether a German soldier should have been allowed into the country how about focusing on Government sanctioned corruption occurring here and now. The My Food Bag IPO is a corrupt offering to raise funds (probably about $100m) to buy licenses for the country to cheat medals at the summer Olympics. My Food Bag parallels the 2004 Feltex Carpets offer. Both took place about four months out from a scheduled summer Olympics. Both occurred into the second term of a Labour lead Government with a female Prime Minister. Both had Forsyth Barr and Jardens as prominent brokers. Jardens were known as First New Zealand Capital in 2004 and Forsyth Bar are not listed as an official lead broker this time but are listed as a “broker” in the prospectus, the only firm so listed. Both offerings ran out of steam towards the end and the price fell following the listing. With both IPOs the vendors were getting out of the company. It was an 100% sale with Feltex and 75% with MFB. NZ came near top of the medals per capita in 2004 and is talking better achievements this time. Medal wins in 2004 were controversial especially those of Ulmer who had to be held on her bike to recover, and the aging Carter and Docherty running away from the field the field.
“In the Feltex Carpets IPO. Eion Edgar was chair of Forsyth Barr, chair of the ACC Investments Committee which threw in $14m by way of subscription, no doubt to set an example, and he was chair of the NZ Olympic Committee. Page 37 of the Feltex prospectus showed a graph of the size of the Australian Carpet Market for the then last 11 years and above it a claim that it had grown 1.7% p.a. compounding over that time. Feltex adopted 1% market growth for its projections of its year 2005 results claiming it was less than the average growth over the past 10 years. But only two of these 11 years (1993 and 2003) were used in making the 1.7% calculation and of these 1993 was outside the 10 year time frame. Using Least Squares Regression Analysis on all those latest ten years gives a size for Year 2005 which is 3% below the 2003 size as against at least 1% above it which Feltex adopted. This deceit bis actionable.
“Among those who sold all their shares in the My Food Bag offering and who resigned their directorship prior to the offering was Teresa Gattung. She was CEO of Telecom in 2003 when Patsy Reddy was a director of Telecom and Telecom “inflated” it profits by having it associated company Southern Cross Cables, which was yet to make a profit, pay it $200m or so in dividends. How much evidence do you want that this was a crooked offering.
“Offerings” such as these have a terrible effect on society. People who oppose the crookedness lose their jobs and worse. Paul Phillip Wilson died aged 21 in Wellington at Easter 2011 when he crashed a car into a bank going uphill. His Mother Wendy was a marketing Manager of some 16 years at Feltex at the time of the IPO. She features in the prospectus. Paul was 14 then. I say angst of seeing marketing figures manipulated resulted in neglect of Paul and his eventual death. He has got into serious trouble and went to Wellington and so died as soon as his home detention finished. A similar story is that of David Patrick Gaynor. In May 2010 his father Brian wrote serious criticism of Craig Norgate in and article titled “Business Ethics a Million Miles Away” in the NZ Herald. There seemed to be no consequences to this article and pupils at Kings College where David and a daughter of Norgate were in the same year would assume that Brian’s accusations were wrong. No doubt David took much flak. David took considerable alcohol and illicit drugs prior to being obliged to attend a function hosted by Norgate in mid 2011. David took his life several hours later.
“Please put your efforts where they could count and expose what is going on with My Food Bag
.