By ELLEN READ
Zespri New Zealand's $16 million share offer has fallen substantially short of its target. The kiwifruit marketing company needed the cash to strengthen its asset base, but attracted only around $8 million from its kiwifruit grower shareholders.
Although the company was outwardly relaxed about the failure, some growers
criticised the timing and features of the offer, saying it was made at the wrong time of year and was not financially attractive enough.
The pro rata and new plantings share offer to kiwifruit producers, the first since Zespri became a grower-owned company a year ago, closed on April 6 having attracted a 60 per cent subscription.
Zespri chairman Doug Voss said: "The offer shortfall does not affect our operations for this season nor strategic growth plans. But we need the capital to strengthen our balance sheet and replace redeemable promissory notes which have provided our traditional working capital."
The offer had been structured attractively with a three-year payment option using existing promissory notes and implemented a voting cap based on production, he said.
South Auckland kiwifruit grower and packer Rob Craig said the offer was made at the lowest cash flow time of the season. However, he was disappointed with the 60 per cent subscription, saying growers were taking a short-term view.
Mr Voss said the board would now look at ways of raising capital while remaining committed to achieving dividends for the company's 2500 grower-shareholders.
