Silver Fern Farms has announced a new completion date of January 2017 for the deal with Shanghai Maling and has pushed back the date for the shareholder requisitioned meeting in Dunedin to 12 August.
The meat processor advises that it and Shanghai Maling have agreed in principle, and subject to respective Board approvals, to a revised date of 30 September 2016 to meet the only remaining condition, Overseas Investment Office (OIO) approval, for the $261m investment by Shanghai Maling.
Chief executive Dean Hamilton says: “We needed to allow more time to answer the further information requests from the OIO and to then provide sufficient time for the OIO and then Ministers to consider the application. We continue to believe that the investment will be approved given its substantial merits.
“The agreement to the new date reflects positively on the ongoing commitment of both parties to the transaction.”
On the basis of the revised OIO date, the parties have agreed to a completion date of 4 January 2017. This will align with what will become the new balance date for Silver Fern Farms and the new financial year of Shanghai Maling.
Accordingly, Silver Fern Farms has set the date of 12 August to hold the shareholder requisitioned meeting in Dunedin.
“We believe the right thing to do was wait until we had clarity on the transaction timing and specifically the extension to the OIO condition date between Silver Fern Farms and Shanghai Maling,” says Hamilton. “Having now agreed in principle and announced the revised OIO condition date of 30 September 2016, we can update the materials to be provided to shareholders so they will be fully informed. These materials will be despatched in the second half of July.
“Whilst the need to extend the OIO condition date is disappointing, it is required to ensure we have sufficient time to respond to the information requests by the OIO. Of note, we believe the requisitioners lodged a submission to the OIO shortly before our previous public deadline for approval of 30 June – some seven months after the OIO process began.”
The board of Silver Fern Farms continues to strongly believe that the October 2015 meeting held to approve the investment by Shanghai Maling, the materials provided to shareholders, and the voting threshold set were fully compliant and legal in all respects. Both the FMA and Companies Office have not found any fault with the Board’s actions, notes Hamilton.
“An overwhelming 82.2 percent of votes from shareholders were in support of the partnership with Shanghai Maling. It remains in the best interests of shareholders and the co-operative, it is a significant opportunity for our farmer shareholders to create an improved future and we intend to follow their direction and complete the transaction in accordance with the revised timetable.”