Wrightson forced to defend new shareholder

PGG Wrightson, New Zealand’s largest rural services company, has been forced to defend new cornerstone shareholder Agria Corp. over US class-action lawsuits and delays in filing its annual report in America.

Wrightson announced last week that Agria, the China-based seed and agricultural research company, would take a 13% stake under a cooperation agreement that’s dependent on Wrightson raising enough capital to repay $200 million of debt due in March.

Agria trades on the New York Stock Exchange and is facing class-action suits over its 2007 IPO. Agria is “vigorously defending these allegations,” Wrightson said in a statement today.

It is awaiting a written decision from the judge on a motion to dismiss filed in July. Agria has also advised that is it urgently completing work to enable it to file its 20-F form, the US equivalent of an annual report.

Wrightson said its due diligence on Agria included “full disclosure” on the lawsuits and late filing. “The fact that the relationship has progressed to the point of announcement demonstrates that neither PGG Wrightson, Agria nor their advisors found issues of significant concern,” chairman Keith Smith said.

Wrightson shares were unchanged at 78 cents.

Businesswire.co.nz

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