Chairman Derek Kirke confirmed the company's plans yesterday, saying it was in response to concerns expressed by shareholders and other wool industry participants; but that it would not be finalised "until the requirements and timing are right".
In June, the Commerce Commission granted authorisation to Cavalier Wool Holdings to make an offer for WSI's wool scouring assets.
The company had made a $40 million conditional offer.
The commission's decision was then appealed by carpet manufacturer Godfrey Hirst, which said it struggled to see how a regulatory body could allow for a monopoly in a key industry.
This would have implications not only for direct users of New Zealand scouring but also for the wool growers, manufacturers and end users of products containing New Zealand coarse wool.
Then a joint venture between Wool Equities Ltd and boutique investment bank Ocean Partners was announced, with the newly established Wool Co hoping to raise $40 million to buy WSI. It has extended the closing date of its offer to December 9, saying it needed more farmers to commit.
The WSI board had been "most reluctant" to publicly debate the raising of capital by the Wool Co, preferring to leave WSI shareholders and wool growers to "make their own carefully considered decisions", Mr Kirke said.
WSI had received many inquiries from shareholders who were concerned and confused because of the board's silence on the matter.
The company had "excellent" recent financial results.
It recorded an after-tax profit of $6.6 million for the year ended June 30, up 479% from $1.1 million the previous year, and an attractive dividend yield.
Many shareholders, wool growers and large farm-related corporates had indicated they would like the opportunity to invest directly in the raising of capital by WSI, Mr Kirke said.
WSI had the correct vertically integrated grower-scour-exporter business model, which was serving farmers and shareholders very well.
Board and management had put considerable work into preparing to raise capital.
They would do so to deal with the shares currently in the hands of the South Canterbury Finance receivers.
However, WSI had a responsibility to shareholders and the wider industry to wait for the High Court decision on the Cavalier appeal.
It would be irresponsible to embark on raising capital or any other action that would involve significant financial and operational resources until the question of the legality of Cavalier's monopoly attempt was resolved, Mr Kirke said.
Judging from inquiries so far, it was clear "timely and properly planned" raising of capital by WSI would enjoy strong support.
A figure could not be put on it until the appeal was resolved.
Mr Kirke urged WSI shareholders and wool growers to keep their capital available until the situation around the shares was resolved.