Eion Garden (L), Silver Fern Farms chairman, and Craig Norgate, PGG Wrightson chairman. Photo / Simon Baker
Shares in PGG Wrightson fell sharply when they came out of a trading halt after the completion of an equity raising process.
The trading halt was put in place on Wednesday, with the company's shares having last traded on Tuesday at $2.10.
Today PGG Wrightson said that after
a global book build process 43.4 million new shares would be issued at a price of $1.80 per share, raising a total of $78.1 million.
After trading in the company's shares resumed today, the price dropped to as low as $1.81, but are now trading at $1.90 - down 20c or 9.5 per cent from Tuesday's close.
The equity raising process was seen as a difficult exercise because the capital is to help pay for PGG Wrightson's investment in meat company Silver Fern Farms.
The meat industry has a history of poor performance and recent turmoil in financial markets has made capital raising more challenging.
The company's acquisition of a 50 per cent interest in Silver Fern Farms was approved by Silver Fern Farms' shareholders on September 8.
PGG Wrightson said it had been advised the placement was well received, with the shares sold to a range of New Zealand and offshore institutional investors, as well as habitual retail investors in this country.
"PGG Wrightson is very pleased with the support shown by existing and new shareholders in the current volatile market conditions," the company said.
The equity placement will be supplemented by a $5000 New Zealand entitlement offer targeting retail shareholders, to be undertaken at the same price - $1.80 per share - as the equity placement.
- NZPA
