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Olam offer for NZFSU tops 50%, going unconditional

Monday 20th September 2010

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Olam International's interest in NZ Farming Systems Uruguay has reached 50.1%, the threshold needed to declare its takeover offer unconditional. 

The Singaporean food and commodities group is offering 70 cents a share for control of Farming Systems, the South American dairy farm developer whose performance has undershot targets amid a lack of capital, drought and doubts about the suitability of some of its land.

Olam will provide the deep pockets the company needs to complete the development of its existing farms, having already committed to securing a short-term credit facility to help Farming Systems get the US$60 million it needs. The shares last traded at 69 cents, with Olam's offer proving too rich for potential rival bidders.

"The strong support for the offer from NZFSU shareholders is a reflection of the full price being offered and the current financial position of NZFSU, which requires shareholders to contribute significant new equity capital," Olam said in a statement.

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