Friday 27 May 2016 02:48 PM
Silver Fern shareholders to vote again on Shanghai Maling deal in July
By Paul McBeth
May 27 (BusinessDesk) - Shareholders of meat processor Silver Fern Farms will have a second vote on whether to approve its planned tie-up with China's Shanghai Maling Aquarius in July, though the board intends to go ahead with the deal irrespective of the outcome.
The cooperative today set the meeting for July 11 in Dunedin where shareholders will vote on approving the proposed partnership and restructure, where the Chinese firm takes 50 percent ownership of the meat processor in return for $261 million of cash, a special dividend, and funds to bankroll the cooperative for seven years. Shareholders backed the deal in October, but John Shrimpton and Blair Gallagher, representing a group of 80 shareholders, have since sought a special meeting to effectively reconsider the transaction.
"Rather than seeking 'approval' of the transaction (which the board notes has already been properly approved), these two requisitioners are seeking to stop the transaction," It is the board's firm view that the cooperative is not, and will not be, bound by the results of the resolution that has been put up and that the transaction with Shanghai Maling remains in the best interests of the cooperative and its shareholders."
The Financial Markets Authority this week turned down complaints that Silver Fern's information pack on the merits of the tie-up was misleading, even though debt turned out to be lower than projected while profit and revenue were higher. The regulator concluded the company's debt was "highly variable" and accepted the board's view that the difference was not material to the vote.
Silver Fern today said those conclusions directly addressed the concerns of the shareholders calling for the special meeting, which it never accepted, and "regards it as now put to rest."
The Overseas Investment Office is assessing the application from Shanghai Maling, a unit of China's state-owned Bright Food Group, which it received in October, and expects to make a decision ahead of Shanghai Maling’s June 30 deadline.