S/PRICE: ALF: Share Price Enquiry

19 Apr 2010 5:03 pm

ALF 19/04/2010 S/PRICE

REL: 1703 HRS Allied Farmers Limited

S/PRICE: ALF: Share Price Enquiry

SHARE PRICE ENQUIRY

We write with respect to the continuous disclosure Listing Rules.

Listing Rule 10.1.1 is set out in the Schedule to this letter. In summary, this rule requires issuers to immediately disclose any Material Information to NZX. The rule provides limited exceptions to this obligation. Material Information does not need to be disclosed where a reasonable person would not expect the information to be disclosed and where the information is confidential and its confidentiality is maintained and where one of five safe harbours applies.

We note that Allied Farmers Limited's (ALF) share price closed on Friday 16 April on the NZSX Market at 5.6 cents per share. This is a decrease of 4.4 cents per share (44%), since close of trading Monday 01 March 2010, and the release of ALF's half year results announcement.

Given this price movement, please immediately advise NZX whether ALF continues to comply with Listing Rule 10.1.1.

Could you please immediately provide NZX with an answer to the above question (email: announce@nzx.com) before 5.00 pm today, Monday 19 April 2010.

Please note that ALF's response to this letter will be published in full to the market.

Yours faithfully

Caroline Young Head of Market Supervision NZX Regulation

RESPONSE OF ALLIED FARMERS LIMITED TO SHARE PRICE ENQUIRY

Dear Caroline

NZX PRICE ENQUIRY

We refer to your letter dated 19 April 2010, in which you refer to the movement in Allied Farmers Limited's (ALF) share price between Monday 1 March 2010 and Friday 16 April 2010, and request ALF to advice whether it continues to comply with Listing Rule 10.1.1.

We confirm that ALF has complied, and continues to comply, with Listing Rule 10.1.1.

On Monday 1 March 2010 ALF announced its half year result, being an unaudited operating loss after tax of $15.68 million (2008; $3.91 million loss) for the 6 month period ended 31 December 2009. ALF also announced that the assets of Hanover Finance and United Finance acquired by ALF in December 2009 had been consolidated into the ALF balance sheet at a fair value of $175.52 million. The agreed transaction value attributed to these assets at the date they were acquired was $396.2 million.

For the period commencing Tuesday 2 March 2010 (the next trading day after the half year announcement) to Friday 5 March 2010, ALF's closing share price fell from 10 cents per share to 7.6 cents per share. This accounts for over half (55 percent) of the 44 percent decrease for the period subject of your enquiry. It would be reasonable to assume that this significant decrease in share price over a short period of time, coming in the days immediately following the announcement of the half year result, was the market's reaction to the half year result announcement and the revised asset value.

For the remaining period to 16 April 2010, there have been a number of negative media reports concerning matters related to certain of the assets purchased from Hanover and United. One could speculate that these reports may possibly have contributed to the balance of the share price movement, but we are unaware of any reason or information that may have contributed to this decrease in ALF's share price.

Yours faithfully Allied Farmers Limited

Ross O'Neill General Counsel & Company Secretary Mobile: 021 424 829

SCHEDULE

10.1.1 Continuous Disclosure of Material Information: Without limiting any other Rule, every Issuer shall:

(a) once it becomes aware of any Material Information concerning it, immediately release that Material Information to NZX, provided that this Rule shall not apply when:

(i) a reasonable person would not expect the information to be disclosed; and

(ii) the information is confidential and its confidentiality is maintained; and

(iii) one or more of the following applies:

(A) the release of information would be a breach of law; or (B) the information concerns an incomplete proposal or negotiation; or (C) the information comprises matters of supposition or is insufficiently definite to warrant disclosure; or (D) the information is generated for the internal management purposes of the Issuer; or (E) the information is a trade secret.

In this Rule 10.1.1, an Issuer is aware of information if a Director or an executive officer of the Issuer (and in the case of a Managed Fund, a Director or executive officer of the Manager) has come into possession of the information in the course of the performance of his or her duties as a Director or executive officer. End CA:00193889 For:ALF Type:S/PRICE Time:2010-04-19:17:03:43

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