Public investment in Fonterra possible

Wednesday 7th April 2010

Institutional investors and the public would finally be able to invest in Fonterra, New Zealand's largest business, under proposed changes to its capital structure put forward to farmers today.

Fonterra Cooperative Group, also the world's largest dairy exporter, confirmed "institutions and the public would also be able to hold units" in the Fonterra Shareholders Fund to help raise the cash needed to pay out farmer shareholders.

"As unit holders in the fund these people would not have shares in Fonterra and, therefore, would not have voting rights," the proposal said.

"This ensures Fonterra remains 100% farmer controlled and owned."

The fund's main purpose would be to offer farmers the opportunity to cash in their right to receive dividends and any capital gains or losses on the share price without losing voting rights or ceding any part of their milk payment.

Use of the fund would be optional, though farmers would also be able to buy back the rights to any dividends or capital movements.

Businesswire.co.nz

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