Shareholders have given their approval and the process of recapitalising Silver Fern Farms starts tomorrow with the opening of the exchange offer and rights issue.
It starts with applications by transacting shareholders to convert rebate and supplier investment shares to ordinary shares, from which they can then participate in a rights issue to subscribe for additional ordinary shares and a fully imputed bonus issue.
An application form has been sent to shareholders, with the offer closing at 5pm on Friday, September 18, but it could be extended.
SFF could raise $128 million from the offer but has said it hoped for $80 million in new capital, which would be used to pay down debt, to fund its plate-to-pasture integrated supply chain and for investment in new technology.
Last week, 76.46% of eligible shareholders voted in support of capital restructuring and SFF chief executive Keith Cooper said yesterday reaction following the vote had been positive, with many inquiries about how to participate.
Just 42.24% of eligible shareholders cast their vote, but the support was such that SFF exceeded the 75% threshold needed to change the constitution.
Federated Farmers meat and fibre chairman Bruce Wills said the result showed there was a mood for change and the SFF proposal offered "a potential way forward" for the meat industry.
Mr Wills said 60 years of history was being turned on its head but it was a prudent step for SFF to strengthen and secure its balance sheet.
There was still support for a merger of meat companies to create one large entity and Mr Wills said the SFF move was potentially a step down that path.
Alliance Group chairman Owen Poole, speaking to his shareholders at Milton yesterday, did not refer once to Silver Fern Farms.
Asked after the meeting his view on the capital restructuring, Mr Poole said the debate had nothing to do with him or Alliance.
