New Zealand Farming Systems Uruguay, the locally listed South American dairy farmer, has canned plans to raise US$120 million through a rights issue after minority shareholders said they wouldn’t participate.
The company planned to use the funds to pay for new development and repay the US$85 million loan to Olam International, which owns a controlling stake in NZ Farming Systems.
After receiving the feedback from minority investors, the board decided to dump the issue, and is seeking to vary the terms of the existing Olam loan, which is due to be repaid by the end of the year.
Olam currently holds 85.93% of Farming Systems, after its full takeover bid came up short of the 90% target that would have allowed it to take the business private.
The shares were unchanged at 65 cents, last changing hands on Oct. 4, and have gained 4.8% this year. Olam offered shareholders 70 cents apiece.
(BusinessDesk)
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