Wools of NZ reaches milestone

TIM CRONSHAW
Last updated 16:21 19/02/2013

Relevant offers

Farming

Fonterra job cuts could bite deeper Prime ewe prices rise at Canterbury sales Heavy prime lambs sell strongly at Coalgate Overseer expands for new demands Ag scientist's career marked by contrasts Dick Smith backs NZ's wire safety campaign Kicking up a stink over another unwanted pest New environmental regs mean big changes Fonterra swings axe: first scares, now tears Ministry lifts export suspension at Pukeuri

After several rounds of wool merger and capital raising collapses, Wools of New Zealand (WNZ) has achieved its minimum threshold of $5 million a week before its share offer's extended deadline of February 25.

The co-operative, until now run by a trust, can proceed from today with establishing a farmer-owned sales and marketing company for strong wool in the carpet and textiles markets. WNZ says it will put its brands and market connections to work and further develop its technical and marketing teams for the benefit of its farmer shareholders.

Chairman Mark Shadbolt said achieving the minimum investment represented an opportunity for strong wool growers who had invested and committed to own the WNZ brands and assets and be involved in a commercial strategy aimed at long term profitability.

"While we are anticipating a late rush of applications from farmers, the good news is that we have met the minimum threshold required. There's still time for growers to get on board and I urge all undecided strong wool growers to consider this opportunity seriously and get their applications in this week, to ensure receipt by the February 25 deadline."

He said the milestone had been reached through the continued support of farmers recognising the need to invest beyond the farm gate. 

Among the investors are farmers who converted some of their loans in the Wools of New Zealand Trust into shares in WNZ.

Shadbolt said this act demonstrated their commitment and confidence in the capital raising and their desire to see the company thrive under farmer ownership.

The WNZ capital raising aimed to raise $10m with a minimum target of $5m.

The successful WNZ bid follows several attempts, including by the larger Wool Partners International proposal, to form farmer-owned groups to increase the profitability of strong wool by controlling the supply of wool from the farm to the market and investing in brands, marketing and sales. They were previously sunk by farmer apathy and lack of funding from low returns.

Ad Feedback

- BusinessDay.co.nz

Special offers
Opinion poll

What is the main issue for farmers in the upcoming General Election?

Environmental policies that stigmatise farmers and erode income.

The high exchange rate.

Slow progress in upgrading rural broadband.

Rural communities under-represented in Parliament.

Vote Result

Featured Promotions

Sponsored Content

rural digi editions 4/9

Digital editions

Read our rural publications online