Latest / Best of Business / Jenee Tibshraeny: NZ Herald Wellington business editor on Kiwibank trying to by TSB

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Jenee Tibshraeny: NZ Herald Wellington business editor on Kiwibank trying to by TSB · Best of Business

• 0:09
  Speaker 1: You're listening to a podcast from Newstalk ZB. Follow this
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• 0:16
  Speaker 2: Janaye Tibshraine is with us. Hello, Janaye.
• 0:19
  Speaker 3: Hi, Heather.
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  Speaker 2: What are Kiwibank's chances, do you think, of actually being
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  Speaker 2: able to get TSB to abandon the Heartland merger and
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  Speaker 2: come to them?
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  Speaker 3: Well, I'd imagine that TSB would stick with its plan
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  Speaker 3: and pursue a merger with Heartland. You know, for these
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  Speaker 3: deals to get to the point that they're at now,
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  Speaker 3: a lot of work needs to go into that. You'd
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  Speaker 3: imagine they'd stick with it. So the charitable trust that
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  Speaker 3: owns TSB, Toy Foundation, it did talk to other parties
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  Speaker 3: before it decided to go with Heartland. So, you know,
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  Speaker 3: it has done that work. Today, the trustees voted on
• 0:54
  Speaker 3: whether to push ahead with the Heartland deal or push
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  Speaker 3: pause on it. So I had hoped to hopefully hear
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  Speaker 3: back from them today, but we haven't heard back. I
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  Speaker 3: think they'll probably announce what they're doing within the next
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  Speaker 3: couple of days. So presumably Kiwi Bank or Kiwi Bank's owner,
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  Speaker 3: Kiwi Group Capital, coming out saying, we have a superior offer,
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  Speaker 3: we'd like to buy TSB, doing that at the last minute,
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  Speaker 3: Presumably they're trying to put a bit of pressure on
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  Speaker 3: those trustees who are voting to say, look, here's an option.
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  Speaker 3: The state could own TSB, keep it in the community.
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  Speaker 3: And that pressure would come on top of the community
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  Speaker 3: pressure that's on those trustees as well.
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  Speaker 2: Kiwibank says that its offer is superior, its proposal is superior.
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  Speaker 2: Is that just because of how much money they're offering?
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  Speaker 3: Look, we don't know. We haven't seen the offer. And
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  Speaker 3: the other thing to think about here is that the
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  Speaker 3: Heartland offer, that sees Toi Foundation maintain a stake, a 17.5%
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  Speaker 3: stake in the new bank. So for the people in Taranaki,
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  Speaker 3: and maintain that TSB brand, which the local people sort
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  Speaker 3: of hold that dear. So I think that's a factor.
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  Speaker 3: So that's a question we'd need to ask Kiwi Group Capital, Yes,
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  Speaker 3: they might be putting more money on the table, but
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  Speaker 3: would they allow the charitable trust to maintain a stake
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  Speaker 3: in the new bank and that branding around TSB as well?
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  Speaker 2: Is it possible actually that TSB is being sold for
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  Speaker 2: far less than it's actually worth? Because if I remember correctly,
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  Speaker 2: and tell me if I'm wrong, but my recollection of
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  Speaker 2: this was that Kiwi Bank had been offered, had been
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  Speaker 2: talked to, and they declined the opportunity to be involved
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  Speaker 2: here because they thought the price was going to be
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  Speaker 2: too high. And then when they saw what the price
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  Speaker 2: actually was, they were like, geez, actually, let's get involved.
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  Speaker 2: So is it possible then that it's being underpriced?
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  Speaker 3: Look, that's a tough question to really know because, you know,
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  Speaker 3: whilst people think banks are really profitable, TSB is a
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  Speaker 3: bit less profitable than some of the other big banks.
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  Speaker 3: It also needs its IT systems, need a whole lot
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  Speaker 3: of investment. So, you know, you have to factor all
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  Speaker 3: those things in and I'm not sure where that all
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  Speaker 3: sort of comes out in the wash. But look, in
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  Speaker 3: terms of the market as well, Heartland is listed on
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  Speaker 3: the New Zealand and Australian stock exchanges, and the share
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  Speaker 3: price hasn't really fluctuated too much. So you would imagine
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  Speaker 3: that the investors, the sort of experts looking at this,
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  Speaker 3: are still pretty confident that the Heartland deal will go ahead. Yeah.
• 3:27
  Speaker 2: All right. Hey, Janaye, as always, a pleasure to talk
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  Speaker 2: to you. Janaye Tibshrainey, the Herald's Wellington Business Editor.
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