Allied Farmers still negotiating banking facilities

Friday 25th June 2010

Allied Farmers is still negotiating its banking facilities for the next financial year.

The firm said it has yet to reach an agreement with its principal banker, Westpac, and another lender. Allied has drawn down $16.5 million on its Westpac credit line, and has an overdraft of $2.5 million that expires on July 1.

“The Allied Farmers business has a number of moving pieces at the moment, with asset sales, settlements, banking and financing arrangements,” said chairman John Loughlin in a statement. “The board and management have been working very hard to finalise a number of issues and are conscious that the date for completion of financing negotiations is not far away.”

Last week, Allied won more than $6 million in a long-running dispute over Californian condominiums, and expects the ruling will make it easier for it to claw back more cash when the properties are sold. Earlier this month, the firm found a conditional buyer for the second stage of the Five Mile property development in Queenstown, worth more than the $23.2 million valuation.

The facilities are secured by a general security agreement over a charging group that includes Allied, its subsidiaries holding the assets of its rural businesses and the assets acquired from Hanover and United, though it excludes the assets in its finance unit, Allied Nationwide Finance Ltd. The shares fell 2.3% to 4.3 cents in trading today, and have slumped some 61% this year.

Businesswire.co.nz

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