Forum Archive Index - November 2003

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

Hi mixtrader,
 
> 
>You make some really valid comments but I feel I must question your
>suggestion that WRI get back into the rural finance sector.
> 
>They are currently in bed with Rabobank and have had some rather
>unfortunate experiences in the past with Fletcher Finance and their
>acquisition of RBFC (later sold to National).
> 
>I agree with you only as far as seasonal finance provision - they no
>longer have sufficient backing (aka clout) to be going out into the
>mortgage finance market, 
>

I take your point mixtrader.  I guess I am suggesting here that rather 
than take on the the banks directly WRI will be lending new money that 
would otherwise have to come from the banks.

As Chris Northmore, Group Manager for Financial Services, put it in 
the latest annual report:

"The company had a long history of experience and success in 
financial services until sellinmg the business to Rabobank in 1998.  
Consistant with the alliance formed with Rabobank, Wrightson began 
to re-enter the market in late 2001 through short term lending to 
selected clients for specific projects.

At 30 June 2003 the company had a $9.5m portfolio of lending related 
to stock purchases and crop inputs.  Rapid growth is expected as new 
finance products are rolled out from now on, including seasonal 
facilities and term loans.  Credit facilities for Rural Supplies purchases 
will also be available, which will give Wrightson a competitive 
advantage in terms of allowing clients to pay for their goods as their 
cash flow permits."

I wasn't suggesting WRI as a serious overall threat to the banks.  I am 
putting them forward as a serious lending alternative in incremental 
projects though.

SNOOPY

PS  I believe the agreement with Rabobank has now expired (five 
years being up).    I could have sworn I read that, but now can't find it 
in the annual report.  Can anyone confirm?



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"You can tell me I'm wrong twice, 
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