Deal to buy Van Leeuwen Group approved by New Zealand Rural Land Company

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The New Zealand Rural Land Company's deal to buy the high-profile Van Leeuwen Group has been approved.

At a meeting last week NZRL's shareholders voted on the $122 million deal.

A purchase of that scale must been approved by the company's shareholders according to the Companies Act and NZX rules.

NZRL director Christopher Swasbrook said 100 per cent of the shareholders present at the meeting agreed to the deal.

Fifteen of VLG's dairy farms in South Canterbury and North Otago would be sold to NZRL and leased back to three of VLG's owned companies.

The lease terms were for 11 years.

NZRL would fund the purchase with $70 million in cash and the balance with new debt from Rabobank.

The transactions would increase NZRL's internal debt to about 40 per cent of total assets from its declared policy of 30 per cent, something the company has said it is comfortable to do.

NZRL also announced this week a $44.3 million rights offer to pay down debt and finance more land acquisitions.

Under the offer, shareholders could buy two shares for every three they own at $1.10 a share.

The price represents an 8 per cent discount to the 10-day volume-weighted average price of $1.20.

VLG was placed into receivership last month under the terms of a general security agreement with an Australian-based fund manager Merrick Capital.

Auckland based Calibre Partners were appointed receivers.

According to the companies office website the receivership ended at midday on Monday, May 31.

Settlement date for the purchase will be today.