Westpac NZ Becomes First Bank to Accept Zespri Shares as Lending Security
Westpac NZ has become the first New Zealand bank to receive approval from the Reserve Bank of New Zealand (RBNZ) to secure and leverage kiwifruit growers' Zespri shares.
Chairmen Ray Sharp and Hendrik Pieters say the two companies are obvious merger partners. "Their respective strengths and the benefits that will follow from the proposed merger will provide a much stronger platform to deal with the challenges that the industry is now facing, particularly Psa," they said in a statement.
The proposed merger would create the largest kiwifruit packing and coolstore operation in New Zealand.
"The main reasons for the merger include creating an enlarged cooperative that is owned by growers," the chairmen say.
"The merged company will be totally focussed on grower owners' needs and in a better position to meet their expectations for quality processing, higher orchard gate returns, low packing prices and improved return on investment.
"We will be creating a business of improved scale utilising the best people, assets and technology from both companies. There will also be various cost-saving synergies from improved facility utilisation, particularly the ability to pack through the most efficient sites," Sharp and Pieters say.
Under the merger, Satara grower shareholders will receive one EastPack Transactor share for each dollar paid-up on their Satara Transactor shares, one EastPack Investor share for each Satara Investor share held, a 5c fully imputed special dividend for each Investor share held and an opportunity to purchase additional EastPack Investor shares at 65c a share.
Satara's non-grower investors (and grower investor shareholders holding excess investor shares) will be offered 60c per investor share plus the 5c dividend. The companies' chairmen said that this would provide an opportunity for non-grower investors to exit their investment in Satara at a fair price (and a substantial premium relative to the last traded price for such shares), considering the current prospects for the kiwifruit post harvest industry.
"Growers are working hard to survive in an environment with a high New Zealand dollar and high Psa related growing costs. We believe that by combining resources, we can reduce costs and operate more efficiently for the benefit of the growers," Sharp and Pieters say.
They say the merged company would also have the financial strength to enable it to quickly upscale with modern, efficient capacity if kiwifruit volumes recover and grow in the future.
Shareholders will be sent merger information packs, including a chairmen's letter, the investment statement and amalgamation proposal for the upcoming shareholder meetings, which will take place in late February. If approved by shareholders, the merger will become effective in March in time for the 2013 packing season.
