NZ Farming Systems Uruguay said it disagrees with some assertions made by Olam International and urged shareholders not to sell their stock pending the company's response to the takeover.
"The offer document from Olam contains a number of comments and assertions with which your board disagrees," Farming Systems chairman John Parker said in a statement. He didn't give details.
The company plans to release its target company statement and independent advisor's report along with its earnings on August 23.
"In the meantime, we note that the share market has priced NZS shares at or above the 55 cents offer price since July 26, Parker said. There is no urgency to accept Olam's offer since it can't close before September 24 and can be extended at Olam's discretion.
The Singapore-based food and ingredients conglomerate holds the prospect of much-needed capital for Farming Systems, whose development and expansion of dairy farms in Uruguay was curbed when the global financial crisis froze credit markets.
Since then it has faced unfavourable weather, including drought, which has sapped production.
Shares of Farming Systems surged by about a third when Olam announced its takeover plans last month, pushing the share price to its highest level in more than a year.
Olam has entered into an agreement to purchase PGG Wrightson's 11.5 per cent stake in Farming Systems subject to regulatory approval, and is making a full takeover offer on the same terms. Olam's offer values the target at $134 million.
NZFSU last year managed to raise US$30 million through the sale of bonds in Uruguay having postponed its capital raising plans in October 2008.
NZFSU is currently farming almost 11,000 hectares and milking almost 20,000 cows. The South American dairy farm developer was set up in 2006 to export New Zealand's intensive dairy farming techniques.
Olam has been actively seeking to add to its food production assets. In 2008, it acquired 25 per cent of Dairy Trust, the owner of cheese maker Open Country Cheese. Olam operates an integrated supply chain for 17 agricultural products and food ingredients in 60 countries.