NZ-based financial services group Tower has hit out at a NZ Shareholders Association suggestion that Tower has given Guinness Peat Group (GPG) “a cheap-ride into a 30% stake”.

In a letter to shareholders, Tower Chairman Olaf O’Duill defended the group’s decision saying the board had “canvassed all possible options” to raise the $180 million needed to keep the business running. GPG simply had the most to offer.

“Throughout the process… the representatives of GPG have been diligent and constructive”, he said. “The only certainty we had of an underwritten capital-raising was from GPG. The GPG offer was negotiated in good faith by its representatives and our senior management.”

He said while the group’s 2002 results were disappointing, a return to normal market conditions along with the capital-raising means the group’s financial position “will be soundly and conservatively structured”.