News
Silver Fern Farms seek more capital 02 Jul 2009
Silver Fern Farms will ask its 20,000 shareholders to raise additional capital to support its strategic commercial initiatives and fortify its balance sheet.
Failure of partnership
The intention to raise capital from supplier shareholders - as indicated at the company’s annual meeting this past January - follows the failure of the PGG Wrightson partnership to proceed last year. This will require a constitutional amendment subject to 75% approval by eligible voting shareholders. The proposal also includes a revamp of the company’s governance structure.
The intention to raise capital from supplier shareholders - as indicated at the company’s annual meeting this past January - follows the failure of the PGG Wrightson partnership to proceed last year. This will require a constitutional amendment subject to 75% approval by eligible voting shareholders. The proposal also includes a revamp of the company’s governance structure.
Importantly, the proposed new capital structure cements farmer control, with suppliers holding a minimum of 60% voting rights and single shareholders or groups of associated shareholders being limited to 5% of the total issued capital.
Under the proposed new capital structure:
· Transacting shareholders could exchange their Rebate Share and Supplier Investment Share holdings for new Ordinary Shares at a ratio of 1:1
· Shareholders who participate in the exchange would be eligible for a Cash Issue of two new Ordinary Shares per ordinary share held, at a subscription price of $1.00 per share
· The issue price per share of $1.00 can either be paid on application or over a period of up to three years by deduction from livestock supplied
· Shareholders can elect to acquire more Ordinary Shares than their entitlement at an issue price of $1.00 per share - subject to the ‘share cap’ of 5%
· Shareholders who take up the offer would receive a bonus offer at a ratio of one bonus ordinary share for every four shares held.
Eoin Garden, Chairman of Silver Fern Farms, says the capital restructuring would underwrite the company’s integrated supply chain strategy, enabling it to match market requirements to its supplier base. “Put simply, this is about being market led and not production driven, which the recent MAF paper: Meat the Future, identified as being an impediment to meat industry progress.
Source and or further info: Silver Fern Farms
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