RD1 & Wrightson Drive Rural Retail Consolidation

Friday, 18 June 2004, 4:45 pm
Press Release: Fonterra Co-operative Group Ltd

RD1 And Wrightson Could Drive Rural Retail Consolidation

Responding to Wrightson's announcement that it was undertaking due diligence on RD1, Fonterra Co-operative Group Chief Executive Officer, Andrew Ferrier, said RD1's rural retail chain could play a key role in consolidation of the rural retailing sector.

"We strongly believe consolidation will create value for the farming industry and we have been in discussions with several participants in the sector, off and on over the past three years."

"We also see a lot of sense in Wrightson being involved, which is why we bought our 19.6% Wrightson stake in the first place."

Mr Ferrier said a logical outcome of current discussions could be a combination between RD1 and Wrightson's Rural Supplies operations.

"This would create a rural retailing chain with an effective market presence. It would benefit our shareholders as customers of these businesses and both Wrightson and Fonterra shareholders as owners."

"Consolidation discussions with Wrightson have taken place for some time. We have identified strong synergies between our respective rural supplies businesses and we firmly believe a merger would be value creating for both Fonterra and Wrightson shareholders."

Any merger or other arrangement involving Wrightson and RD1 would be conditional on obtaining all necessary consents and approvals.

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