Seeka eyes listing on main board

Seeka Kiwifruit Industries is stepping up to the main stock exchange board as it moves to raise $15 million.

The kiwifruit orchard manager and fruit processor is seeking around $9.5 million through a one-for-four rights issue plus $2.1 million through a non-renounceable issue to growers of 470,000 shares.

The grower issue will be based on production of Seeka's supplier growers, whether they are shareholders or not, and they can pay half this year and half next year.
As well, Seeka will make a placement to selected investors to raise $3.5 million.

Director Chris Morton, Seeka's largest shareholder with 17.1 per cent, intends to increase his shareholding to 19.9 per cent and has committed himself to take up his rights and participate in the placement.

The issues are not underwritten so it is not certain how much will be raised.

ABN Amro Craigs is the lead manager for the issues, scheduled for completion by July 31.

If all rights were taken up, the number of shares on issue would rise from 8.67 million to about 12.2 million, giving the company a market capitalisation of about $50 million.

Authority for Morton's participation in the placement was obtained on February 23 at a shareholder special meeting.

Seeka was founded in 1987 and its shares traded on the Unlisted market in 1995 until it moved to the NZX Alternative market in November 2003. In March, it completed the issue and placement of a $5 million convertible note issue as the first step in its capital-raising programme.

Pricing of the issues will be set by the directors at a discount to the prevailing market price of Seeka.

A prospectus is scheduled to be mailed by June 28.

The company will seek approval for a new constitution at its annual meeting on July 5 in Tauranga and the company plans to list on the main board on July 26.

Seeka posted a slightly reduced March-year net profit of $3.04 million, consistent with its previous forecasts. In the past six months Seeka has acquired Eleos and BridgeCool Holdings, plus a strategic stake in Opotiki Packing and Coolstorage.

Seeka expects to process 20.76 million kiwifruit trays in 2005/6, up 71 per cent on the March 2005 year and its projected market share of fruit supply would rise from 2004/05's 14 per cent to 27 per cent in the 2005/06 year. The money raised will be used to restore debt-equity ratios to around 50 per cent.

Seeka shares last traded at $4.70, and have traded between $4.20 and $5.10 in the past year.

- NZPA

Seeking gains

* Seeka is New Zealand's largest kiwifruit supply company, forecast to handle more than 26 per cent of the total kiwifruit production from the 2005 harvest, totalling some 23 million trays of green, gold and organic fruit.
* The company is listed on the stock exchange's secondary market the NZAX, and plans to list on the main market.
* Seeka acquired service providers Eleos and Bridgecool and a 20 per cent stake in Opotiki Packing and Coolstorage last year.