Wellington, New Zealand, March 20--Troubled carpet maker Feltex has been abandoned by a potential white knight, with rival Godfrey Hirst announcing today it has almost halved its stake in the New Zealand company, according to TMC Net.
Godfrey Hirst issued a substantial shareholder notice to the Stock Exchange today revealing it had reduced its stake to 4.57 percent from 8.72 percent between March 14 and March 20.
The news explained an aggressive selloff in the stock, with Feltex shares tumbling sharply in the past week to close today down 12.5 percent at a fresh low of 35c.
This time last year the shares were worth $1.56. A series of profit downgrades and a senior management rout a year after listing in June 2004 at $1.70 have left the firm in tatters.
Last month Feltex reported a first half after tax loss of $11.83 million--down almost 200 percent on the previous year.
Privately-owned Godfrey Hirst, Australia's biggest carpet maker, emerged as a potential saviour last year, and again in January when it boosted its stake from 5.78 percent to 8.72 percent in an on-market stand.
But Feltex last month said talks between the pair had been terminated, with the potential deal not seem in the "best interests'' of Feltex shareholders.
Godfrey Hirst had designs on a merger with Feltex, which would have resulted in a reverse takeover by the Australian firm and a backdoor listing.
Feltex declined to comment on today's share activity.
"They didn't comment when they bought the shareholding and they won't comment now,'' Feltex spokesman David Porter told NZPA.
