Chinese seeds and research company Agria, will buy about half of Rural Portfolio Investments' rights entitlement with PGG Wrightson for an undisclosed sum.

Rural Portfolio Investments (RPI), the investment vehicle for former Fonterra chief executive Craig Norgate and Baird McConnon, initiated a trading halt this afternoon.

Mr Norgate said he could say little pending an announcement to the NZX this afternoon.

When exercised, the rights will cost Agria about $25 million to move to a shareholding of 19%.

Last week, Rural Portolio Capital, a subsidiary of RPI, announced it had funds for its next divident payment to redeemable preference shareholders. A month earlier, RPI told its trustee its dividend escrow account had insufficient funds for the April 2010 dividend payment.

RPC has 60 million redeemable preference shares on issue at a face value of $1.

In a statement to the stock exchange last week, the company said the escrow account was fully funded to meet the obligation.

There was no explanation as to where the funding came from but there was speculation that Mr Norgate and Mr McConnon would be using their own capital.

If that were true, then the pending payment from Agria as part of a share realignment of PGG Wrightson, would help the cause.

RPI was running close to the bone and missed out on vital cashflow when PGG Wrightson failed to pay a dividend after a $54 million loss last year. It has also indicated there would be no dividend to shareholders for 2010 either.

RPI holds 27.5% PGG Wrightson shares would have between 11-12% following the company’s capital raising exercise announced today.