Listed locals chase investors

FOUNDERS of listed companies in WA are reviewing the scale of their controlling interests in a bid to attract investors who have turned their backs on local stocks.

The Clough family are the latest to raise the issue, flagging the possibility of reducing their controlling stake in engineering and construction group Clough.

Several leading WA companies, like Clough, and have listed in the past few years have huge blocks of shares held by founding families or management whose dominance makes the stock less attractive for many investors, particularly institutions.

These stocks largely fit into the smaller companies category which has been abandoned by stockmarket investors who favoured high tech stocks until April and then turned their attention to the safety of the blue chip zone.

Liquidity and longer-term growth are the key issues for investors which see tightly held companies as being difficult to trade in and lacking opportunities to access the market for capital needed to finance expansion.

Evans & Tate director Mike Calneggia attributed the need to increase liquidity as the key motivation for his recent decision to sell down three per cent of his 11 per cent stake in the listed wine-maker.

Hartley Poynton analyst David franklyn said dominant stakes in private hands could constrain growth and put off institutional investors.

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