Ball in PGG Wrightson’s court - Zuellig
Zuellig Group executive Peter Williams has returned to Australia having briefed the PGG Wrightson board on his company's interest in the rural services firm.
Zuellig Group executive Peter Williams has returned to Australia having briefed the PGG Wrightson board on his company's interest in the rural services firm.
Zuellig Group executive Peter Williams has returned to Australia having briefed the PGG Wrightson board on his company’s interest in the rural services firm.
The Hong Kong-based company said last week it was talking to potential investors about a possible partial takeover of PGG Wrightson.
“We had a very pleasant meeting with PGG Wrightson and we are now awaiting guidance from them as to whether they can or wish or want to engage with us,” Mr Williams told NBR yesterday.
“We were certainly politely and well received. We laid out our credentials and we hope to get a response from them very soon.”
PGG Wrightson has acknowledged the informal talks but says it has not yet received notification of an intention by Zuellig to lodge a formal takeover offer.
While Zuellig says it is keen on first acquiring a cornerstone stake, it was also open to joining a consortium to make a play for 50 percent of the shares in PGG Wrightson.
Mr Williams said talks with various investors were continuing.
“We’ve had a number of meetings and it’s very much a work in progress. It’s a type of transaction that people need to get their minds around.”
Zuellig’s interest comes as PGG Wrightson shareholders consider an existing partial offer from Chinese companies Agria Corporation and New Hope Group.
Agria is seeking to move from 19 percent ownership to control at 50.01 percent by paying 60c a share. Current major shareholder Pyne Gould Corporation has agreed to sell its 19 percent stake into the offer,
meaning Agria has about 40 percent of the shares in PGG Wrightson.
That offer is scheduled to close on April 15.
Asked whether Zuellig was considering joining the Agria and New Hope bid, Mr Williams said that was not thought of an option.
“It’s a difficult question to answer because even Agria and New Hope to me is interesting. New Hope is a company we know and respect in Asia. A number of my colleagues have dealings with them. But Agria is a more opaque company.”
New Hope is China’s largest private agricultural conglomerate and largest animal feed producer.
Its chairman, Liu Yonghao, mentioned the PGG Wrightson bid to reporters outside parliament in Beijing yesterday.
"It is difficult to acquire land or farms overseas or in New Zealand, but it will benefit us to take over some good companies which play a key role in the local breeding industry," Mr Liu told reporters.
Mr Williams flagged Zuellig’s interest just days after PGG Wrightson said a second party had decided not to proceed with a full takeover offer after completing due diligence. That party was understood to be Canadian-based Agrium, whose subsidiary Landmark owns half of PGG Wrightson rival RD1 with Fonterra.
Zuellig has extensive interests in the animal health industry throughout Asia. The company, which is ultimately owned by the Zuellig family of Switzerland, owns 40 percent of the New Zealand tractor distribution market, through CB Norwood.