Allied Farmers agrees to settle

RICHARD MEADOWS
Last updated 16:01 20/12/2013

Relevant offers

Farming

Marlborough wine companies confident earthquake-damaged storage will be ready for vintage Banks Peninsula farmer tries holistic farming to boost his bottom line Waiting, with 'baited' breath, for Sounds fishing park Fired-up farmers want Healthy Rivers withdrawn, amended Dairymeade sheep auction a 'big boost to NZ sheep milking industry' Poked and prodded but all in a good cause Rotorua dairy farmer Chris Stevens runs three farms Magical land at Yealands' Seaview Vineyard Estate lights up exhibition by Jim Tannock and Helen Simpson Just another day on job for top-dressing come fire-fighting pilot New technology could make life easier for farmers and pilots

Allied Farmers has conditionally agreed to settle a $2 million debt owed to Palmerston North-based fresh food company Speirs Group.

The farming services company's liability dates back to a "put and call option" contract with Speirs from 2008.

In July Speirs chose to exercise its "put" option, meaning it wanted to cash up.

According to an Allied update to the NZX, the companies have agreed to settle the obligation by issuing Speirs 14.7 million new Allied shares.

Based on the latest closing price of 3.6 cents, that values the private placement at about $530,000. The shares have gained 19.4 per cent today to 4.3c.

Allied has also agreed to pay Speirs $500,000 at the end of April 2016, which will be unsecured and will not incur interest in the interim.

The deal is a related-party transaction, because Speirs director Nelson Speirs was until recently also a director of Allied subsidiary NFA, which is in liquidation.

That means the settlement is conditional on Allied receiving a waiver from the NZX, as well as Speirs receiving permission from its shareholders.

Allied chairman Garry Bluett said the directors considered the settlement to be a good result for the company and its shareholders.

The company's shares have tracked upward recently after plummeting as low as 0.8c in October last year.

Since then, Allied has resolved a dispute with the Inland Revenue Department over a liquidation notice for $4.2m, and another dispute with a major creditor.

Ad Feedback

- Stuff

Special offers
Opinion poll

Is it time for authorities to introduce tougher penalties for poaching?

Yes

No

Vote Result

Related story: Booby traps for poachers cost farmers

Featured Promotions

Sponsored Content

Agri e-editions

Digital editions

Read our rural publications online