Takeover target NZ Farming Systems Uruguay (NZFSU) has been granted tax benefits currently worth $US20 ($NZ29) million to $US25m under Uruguayan tax law.The benefits would be available to offset the company's tax liability once it becomes profitable, anti
Takeover target NZ Farming Systems Uruguay (NZFSU) has been granted tax benefits currently worth $US20 ($NZ29) million to $US25m under Uruguayan tax law.
The benefits would be available to offset the company's tax liability once it becomes profitable, anticipated to be in the 2011-12 financial year.
Company chairman John Parker said approval of the income tax concessions recognised its investment in developing dairy farms, including investment in milking sheds, roading, electricity, irrigation and other infrastructure.
"We are delighted that the government of Uruguay has recognised the beneficial impact of our operations in keeping with its established policy to promote investment," Mr Parker said.
"Our operations have already created about 400 new jobs in rural communities in Uruguay, with 31 milking sheds now in operation, plus dry stock land, quite apart from the substantial temporary impact of employment created while farms are being established."
The NZFSU board has received a 55c per share takeover offer from Singapore-based Olam International, which previously had a stake of 18.45 percent in NZFSU, and has a commitment from PGG Wrightson that it will accept the offer for its entire 11.52 percent shareholding.
The board has told shareholders to wait for further advice in the target company statement and to retain their shares in the meantime.
NZFSU shares were unchanged at the offer price on the New Zealand stock exchange yesterday.
