Silver Fern Farms (SFF) chairman Eoin Garden remained upbeat and optimistic on Friday that the $220 million deal could be salvaged, after it was faulted on Tuesday when PGG Wrightson failed to secure funding.
PGG Wrightson (PGG-W) chairman Craig Norgate said on Friday progress was being made.
Regardless whether PGG-W came up with the capital, Mr Garden said in an interview it was business as usual.
The Dunedin meat co-operative would pursue its integrated supply chain model and he was "reasonably" comfortable the deal would be completed.
While commercial deals were falling over due to the international meltdown of financial markets, Mr Garden said, "we're not talking about that at all".
PGG-W chairman Craig Norgate said in an interview on Friday that progress resurrecting funding to settle the $145 million first instalment due last Tuesday, had been made, but "it was not there yet".
Last Tuesday, PGG-W announced banks had been unable to finalise credit approvals in time for the part-settlement deadline due to the international credit meltdown.
Mr Garden confirmed there was a penalty clause should PGG-W default on the agreement, but he stressed the two parties were "not at that stage" and that the contract allowed for the month of October for settlement.
Equally, Mr Garden said the board was not contemplating going back to shareholders for funds should the PGG-W partnership fail to be completed: "That is not in our discussions."
Banking facilities for the coming season had been finalised in August.
"The financial position of SFF is very sound and we are very confident going forward."
Last week, it paid, as promised, $10 million in rebates to suppliers, made up of $8.6 million in cash and $1.4 million in rebate shares.
The rebate was based on $9 a lamb, 20c a kg for cattle and 15c a kg for deer.
It also paid a dividend on its supplier investment shares and has forecast a profit for the year of about $40 million.
Mr Garden described as "hypothetical" any thoughts PGG-W would not come up with the $220 million.
But if that was the case, SFF would continue with changes to its supply chain structure, rebranding and introducing new technology.
"It's not predicated on PGG-W, that's the important thing shareholders need to know."
Instead of 18 months to two years to implement its proposed capital expenditure under the partnership, Mr Garden said, that same investment could take four to six years if they did it alone.
SFF intended implementing its integrated supply chain regardless, but he said the company had never put a time frame around the project and if PGG-W was unable to make its investment, the meat company would make the changes as its balance sheet allowed.
Mr Norgate was reluctant to reveal much about progress in securing the necessary funding, saying he wanted to give certainty, but only when he was able to provide something tangible,PGG-W shares took a dive on Friday, losing 14c during the day to close at $1.71 with 445,000 shares traded.
The closing price was still well above its lowest point for the year of $1.60.
