Article – BusinessDesk
Dec.30 (BusinessDesk) New Zealand’s largest agriculture technology and services provider PGG Wrightson has bought back notes issued to its major shareholder Agria and transferred the loan to its banking facilities, which have been extended to July …
PGG Wrightson repays Agria notes by boosting bank facilities
By Russell Palmer
Dec.30 (BusinessDesk) New Zealand’s largest agriculture technology and services provider PGG Wrightson has bought back notes issued to its major shareholder Agria and transferred the loan to its banking facilities, which have been extended to July 2014 at a cheaper interest rate.
PGG sold the Convertible Redeemable Notes as part of a deal with Agria of Singapore in January 2010. Agria currently holds 50.2 percent of the shares in PGW. It paid $33.85 million for the notes, up $150,000 on the original selling rate of $32 million, which does not include the 8% interest since the CRNs were issued.
The company’s chief financial officer Rob Woodgate told BusinessDesk the loan has been transferred to its two banking facility loans, which have increased by “almost the same amount” as the cost of the CRNs.
The $75 million and $125 million facilities, plus the roughly $33 million for the CRN notes, have been extended to July 2014 at a lower interest rate, which he declined to disclose.
PGG Wrightson’s shares are selling at 37c today, down from 55c per share a year ago. It made a net loss of $30.7 million for the 12 months to Jul. 30, but made a $23.3 million profit in the same period in the previous year. This year’s loss was attributed to the Canterbury earthquake in the last annual report.
Agria Corp. completed its $144 million partial acquisition of the company in May, giving it control of the rural services company five months after its bid was launched.
Agria’s bid, launched in conjunction with Chinese agricultural giant New Hope, represented a 25% premium on Wrightson’s share price at the time.
The Singaporean company, which originally sought to lift its ownership to 50.01% at 60 cents a share, received acceptances from shareholders speaking for 78.16% of Wrightson’s stock.
Wrightson sold its financial unit to would-be bank Heartland New Zealand earlier this year, and Heartland last month dipped into its surplus cash reserves to retire $92.3 million of its acquisition bonds.