Zuellig continues to hound PGG Wrightson

PGG Wrightson’s alleged second suitor, Hong Kong-based Zuellig Group, has criticised the rural services firm for not allowing it to undertake due diligence on the company.

Zuellig Group said it was disappointed at its rejection having outlined to PGG Wrightson its plans to acquire a cornerstone shareholding of 19.9% a month before an existing offer from Agria Corporation for a controlling stake closes.

“It is also particularly disappointing for PGG Wrightson shareholders who we think should have the ability to consider what a rejection of the Agria offer could entail, in particular having Zuellig as a new cornerstone shareholder,” Zuellig said in a statement.

The statement follows an announcement yesterday morning from PGG Wrightson that suggested Zuellig was not a serious potential bidder for shares in the company and its approach was more designed to prevent Agria’s offer succeeding.

“To date, the approach from Zuellig seems to have a primary motivation of frustrating the Agria offer,” PGG Wrightson said, adding that Zuellig had not indicating any pricing or terms of any potential offer.

Zuellig senior group executive Peter Williams said despite the rejection Zuellig would again seek to undertake due diligence if Agria failed to get to 50.1%.

Agria and New Hope Group have offered 60c-a-share for Agria to move from 19.9% to 50.1%. PGG Wrightson cornerstone shareholder Pyne Gould Corp has already accepted the offer meaning Agria already has close to 40%. The offer closes on April 15.

Mr Williams said Zuellig outlined its plans when it met PGG Wrightson representatives in Christchurch on March 4 and had reiterated those aims in a letter on March 14.

Zuellig claimed its objectives included “ensuring PGW remains a NZ-based agribusiness” and to “assist the company to substantially improve the performance of its core AgriServices businesses and to facilitate its overseas growth ambitions, particularly the global expansion of its world-class seeds business.”

Mr Williams said Zuellig had opposed Agria’s application to the Overseas Investment Office.

“In particular, we have concerns around the future direction and performance of the company, of which the non-Agria shareholders will continue to own 49%, under control of a shareholder of an unknown quantity.”