Wool float aims to raise $10m

Last updated 16:00 16/11/2012

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Wools of New Zealand will hold a meeting for growers at the Giesen Sports and Events Centre in Renwick next Friday at 4pm as part of a proposal to raise $10 million.

The capital raising is planned by Wools of New Zealand to help commercialise it into a sales and marketing company.

A previous $65m capital-raising launched by the associated Wool Partners Co-operative (WPC) in October 2010 failed when the co-op secured only about $38.5m from sheep farmers.

Wools of New Zealand chairman Mark Shadbolt, who was also involved in the WPC venture, is now talking up the prospects of the Wools of New Zealand capital-raising, saying it is needed to help sell New Zealand wool overseas "direct to market", and clear debt.

Wools of New Zealand's prospectus has been approved by the Financial Markets Authority, and Shadbolt said it would be sent out to about 16,000 farmers and other interested parties.

The growers would be invited to subscribe for shares at a ratio of one share for every 2kg of their annual strong wool production. The minimum subscription would be 5000 shares at $1 a share.

The offer would close on December 14 at 5pm, and Shadbolt said he had no reason to doubt that the minimum capital-raising level of $5m would be reached. The funds raised would help pay back the $550,000 needed to launch the prospectus and capital-raising, plus $1.8m of loans incurred with the purchase of Wools of New Zealand by a trust from PGG Wrightson in October 2011.

The remainder would be used to develop marketing and royalty earning programmes around the company's brands, including Laneve, Wools of New Zealand and Glacial, a brand licensed to wool scourer and exporter NZ Wool Services International, said Shadbolt.

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- The Marlborough Express

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