Australian rural servicing company Elders has increased its shareholding in New Zealand’s largest company in the same business, PGG Wrightson.
A substantial product holder notice to the NZX exchange said Elders now owns 12.3% of PGW, having bought a further 758,000 shares between December 20, 2022 and August 18, 2023.
The expenditure was $3.2 million and Elders now has an investment of $37m in PGW, based on market capitalisation at the current $4.05 share price.
In fact, it has paid over $40m because the bulk of its holding was bought at $4.35 last December from BCA New Continent Agri Holdings of Hong Kong.
PGW’s majority shareholder is Agria Singapore, with 44%.
Elders has long played in the NZ rural markets, firstly in the 1990s by way of direct investment by John Elliott from Australia, and more recently as a part NZ-owned company under the Elders name, then sold to Carrfields in 2014.
In December it told the Australian ASX exchange that it was not currently intending to initiate a proposal to acquire control of PGW.
Its FY2022 results included A$3.4billion in sales and $232m earnings, and on August 21 it announced a reduced guidance range for the FY2023 financial year of $165m to $175m.
“Elders is experiencing cautious customer sentiment in light of uncertain seasonal conditions in some farming regions, compared to forecast assumptions,” it said.