MIRA INFORM REPORT

 

 

Report Date :

12.10.2013

 

IDENTIFICATION DETAILS

 

Name :

BLOCH & BEHRENS WOOL (NZ) LIMITED

 

 

Registered Office :

57 Waterloo Road Hornby Christchurch 8042

 

 

Country :

New Zealand

 

 

Financials (as on) :

30.06.2013

 

 

Date of Incorporation :

12.04.2000

 

 

Com. Reg. No.:

1027107

 

 

Legal Form :

Limited Private Company

 

 

Line of Business :

Exporter of New Zealand wool.

 

 

No. of Employees :

2,700 employees (PGG Wrightson Limited)

 

RATING & COMMENTS

 

MIRA’s Rating :

Ba

 

RATING

STATUS

PROPOSED CREDIT LINE

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

Satisfactory

 

Status :

Satisfactory

 

 

Payment Behaviour :

No Complaints

 

 

Litigation :

Clear

 

NOTES:

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

 

ECGC Country Risk Classification List – March, 31st, 2013

 

Country Name

Previous Rating

(31.12.2012)

Current Rating

(31.03.2013)

New Zealand

A1

A1

 

Risk Category

ECGC Classification

Insignificant

 

A1

Low

 

A2

Moderate

 

B1

High

 

B2

Very High

 

C1

Restricted

 

C2

Off-credit

 

D

 

 

NEW ZEALAND - ECONOMIC OVERVIEW

 

Over the past 20 years the government has transformed New Zealand from an agrarian economy dependent on concessionary British market access to a more industrialized, free market economy that can compete globally. This dynamic growth has boosted real incomes - but left behind some at the bottom of the ladder - and broadened and deepened the technological capabilities of the industrial sector. Per capita income rose for ten consecutive years until 2007 in purchasing power parity terms, but fell in 2008-09. Debt-driven consumer spending drove robust growth in the first half of the decade, helping fuel a large balance of payments deficit that posed a challenge for economic managers. Inflationary pressures caused the central bank to raise its key rate steadily from January 2004 until it was among the highest in the OECD in 2007-08; international capital inflows attracted to the high rates further strengthened the currency and housing market, however, aggravating the current account deficit. The economy fell into recession before the start of the global financial crisis and contracted for five consecutive quarters in 2008-09. In line with global peers, the central bank cut interest rates aggressively and the government developed fiscal stimulus measures. The economy posted a 2% decline in 2009, but pulled out of recession late in the year, and achieved roughly 2% per year growth in 2010-12. Nevertheless, key trade sectors remain vulnerable to weak external demand. The government plans to raise productivity growth and develop infrastructure, while reining in government spending.

 

Source : CIA

 


IDENTIFICATION DETAILS

 

Verified Address

 

Subject name :              BLOCH & BEHRENS WOOL (NZ) LIMITED

Business address :        114 Wrights Road

Province :                      Christchurch

Zip/postal code :            8149

Country :                       New Zealand

Tel :                              +64 3 3394670 / +64 3 3439100

Fax :                             +64 3 3390328 / +64 3 3439108

Email :                          bbnz@blochwool.com

Website :                      www.pggwrightson.co.nz

 

Registered address :      57 Waterloo Road

Town :                           Hornby

Province :                      Christchurch

Zip/postal code :            8042

Country :                       New Zealand

 

Postal address :            P.O. Box 9024

Town :                           Tower Junction

Province :                      Christchurch

Zip/postal code :            8149

Country :                       New Zealand

 

 

SUMMARY DETAILS

 

Executive Summary

 

Date founded or registered :        12/04/2000

Legal form :                               Limited Private Company

Chief executive :                        Mark Braden Neil Dewdney

Issued & paid up capital :           NZD 500,000

Sales turnover :              NZD 1,131,847,000 (Group-Consolidated 12 months, 30/06/2013)

Net income :                              NZD -304,921,000 (Group-Consolidated 12 months, 30/06/2013)

Total fixed assets :                     NZD 619,508,000 (Group-Consolidated 12 months, 30/06/2013)

Line of business :                       Exporter of New Zealand wool.

Staff employed :             2,700 employees (PGG Wrightson Limited)

 

 

CREDIT RISK OPINION

 

Company Analysis

 

Country risk :                             Country risk is minimal

Operation trend :                        Operational trend is steady

Management experience :           Management is adequately experienced

Financial performance :              Financial performance is fair

Organization structure :              Organizational structure is stable

Detrimental :                  No detrimental records found

Payment history :                      No payment delays noted

Comments :                              Larger credit can be provided if guaranteed by Parent Company PGG Wrightson

Limited.

 

 

STATUTORY DETAILS

 

Registry Data

 

Registration date :                      12/04/2000

Legal form :                               Limited Private Company

Registration no                          1027107

Registered authority :                 New Zealand Companies Office

Registry status :                        Live/Active

Previous name :                         None reported.

Change of legal form :                 None reported.

Other registration :                     The Subject is a member of the International Wool Textile Organisation (IWTO)

and the New Zealand Council of Wool Exporters Inc (NZCWE) and is a registered supplier of controlled quantities of certified organic wool.

 

 

MANAGEMENT / DIRECTORS

 

Key Management

 

Name :                          Mark Braden Neil Dewdney

Designation :                 Chief Executive Officer

 

Name :                          Palle Petersen

Designation :                 General Manager of Export

 

Name :                          Hans Bering

Designation :                European Manager

 

 

BOARD OF DIRECTORS/ OTHER APPOINTMENTS

 

Appointments

 

Name :                          Cedric John Bayly

Designation :                 Director

Appointment date :         25/05/12

Address :                      634 Matapiro Road, Rd 9

Hastings 4179

New Zealand

Biography :                    A doyen of the Wool industry, Cedric John Bayly was appointed as GM of PGG Wrightson Wool in early August 2011. Most recently he was the national manager of Elders Primary Wool and for nine years was GM: Wool at Williams & Kettle, one the main components of the

PGG and Wrightson merger in 2005.

 

Name :                          Mark Braden Neil Dewdney

Designation :                 Director

Appointment date :         28/06/13

Address :                      73 Poplar Lane, Rd4

Hamilton 3284

New Zealand

Biography :                    Mark Braden Neil Dewdney was Chief Executive of Livestock Improvement Corporation Ltd from 2006 to 2013, responsible for implementing a new strategic plan focused on innovation from investment in research and technology and providing integrated

solutions for customers in New Zealand and internationally. Prior to that Mark was  marketing career in the New Zealand dairy industry. Mark also has ownership interests in dairy farms in both New Zealand and Australia and is a director of the

Waikato based, Tatua Co-operative Dairy Company Ltd.

Staff employed :             2,700 employees (PGG Wrightson Limited)

 

 

SHARE CAPITAL

                     

Composition

 

Authorized Capital :        NZD 500,000

No of shares :                500,000 Shares

Share par value :            NZD 1

Issued capital :              NZD 500,000

Paid up capital :             NZD 500,000

 

 

OWNERSHIP / SHAREHOLDERS

 

How listed :                   Full List

 

Composition

 

Shareholder name :        PGG WRIGHTSON LIMITED

Address :                      57 Waterloo Road

Hornby, Christchurch 8042

New Zealand

No. of shares :               500,000 Shares

% of shares :                 100%

 

 

RELATED COMPANIES & CORPORATE AFFILIATIONS

 

Structure

 

Name :                          AGRIA CORPORATION

Affiliation type :              Ultimate Holding Company

Address :                      Room 1206, Huantai Building

12, Zhongguancun South Street

Haidian District

Beijing 100081

People’s Republic of China

Comments :                  Agria Corporation, through its subsidiaries, operates as an agriculture company in

China and internationally. Its China Seeds segment primarily engages in the research and development, production, and sale of seed products, including field corn seeds, edible corn seeds, and vegetable seeds. This segment markets its seed products to distributors, farmers, and other customers. The company’s International Seeds segment supplies commodity and proprietary forage seed products, such as grass seeds, seed treatment products, forage legumes, forage brassicas, herb seeds, pea seeds, and turf seeds; imports and wholesales liquid animal feeds based on sugar cane molasses; manufactures and supplies products for treating facial eczema in livestock; and supplies cereal seeds comprising feed wheat, milling wheat, malting barley, feed barley, maize, and proprietary cereals. Its AgriServices segment supplies agricultural products and services, including agri-chemicals, stockfeed, fencing products, chemicals, fertilizers, pollination products, and frost protection products; and provides advice in relation to livestock genetics, stocking and animal evaluation, valuation, and selling and buying strategies, as well as offers insurance products consisting of farm, domestic, livestock, crop, and business insurance. This segment also operates a national rural real estate business; and engages in the design and installation of turnkey irrigation and pumping projects for arable, pastoral, and dairy platforms. Agria Corporation was incorporated in 2000 and is based in Beijing, the People’s Republic of China.

 

Name :                          AGRIA GROUP LIMITED

Affiliation type :              Intermediate Holding Company

Address :                      British Virgin Islands

 

Name :                          AGRIA ASIA INVESTMENTS LIMITED

Affiliation type :              Intermediate Holding Company

Address :                      British Virgin Islands

 

Name :                          AGRIA (SINGAPORE) PTE LTD

Affiliation type :              Intermediate Holding Company

Address :                      80 Raffles Place

#16-20 Uob Plaza 2

Singapore 048624

Singapore

 

Name :                          PGG WRIGHTSON LIMITED

Affiliation type :              Parent Company

Address :                      57 Waterloo Road

Hornby, Christchurch 8042

New Zealand

Comments :                 PGG Wrightson Limited provides various products, services, and solutions to

farmers, growers, and processors in the agricultural sector in New Zealand and internationally. It operates rural supplies stores for animal health and nutrition products, grains and seeds, chemicals, clothing, leisure goods, and gardening equipment; and Fruitfed Supplies stores that offers horticultural crops, crop protection products, proven crop nutrition options, glasshouse supplies, wind machines, sprayers, and irrigation and pruning equipment. The company is also involved in the provision of agricultural and horticultural training, and consulting services; trading and export of rural livestock k; and brokerage and export of wool, as well as offers a selection of rural, lifestyle, residential, commercial, and industrial properties. In addition, it is involved in the design, construction, and maintenance of irrigation and pumping systems, such as valley centre pivots, precision corners, and linear irrigators; ocmis hard hose irrigators; travelling

irrigators, sprinklers, and k-line systems; and a range of submersible and surface

pumps. Further, the company is engaged in the research, development, manufacture, and sale of forage seeds, turfs, and grains; and purchase, manufacture, and distribution of liquid animal feeds and other products. Additionally, it provides insurance products, such as farm, specialist farm, business, and domestic insurance. PGG Wrightson Limited was founded in 1841 and is based in Christchurch, New Zealand.

 

Related companies and corporate : Other companies of the Agria Group should be considered affiliated companies of affiliations comments the Subject.

 

 

BANK & MORTGAGES

 

Bank Details

 

Name of bank :              The Australia and New Zealand Banking Group Limited

Address :                      New Zealand

Account details :            Current account

Comments :                  It is generally not the policy of local banks to provide credit status information to

non related parties, however interested parties would be advised to consult first with the Subject if banker's references are required.

Mortgages :                   None reported.

 

Legal Fillings

 

Bankruptcy fillings :        None reported.

Court judgements :         None reported.

Tax liens :                     None reported.

Others :                        None reported.

 

 

 

 

FINANCIAL DATA

 

Description

 

Source of financial statement :    Public Record Sources

Financial statement date :          30/06/13

Type of accounts :                     Full audited

Currency :                                 New Zealand, Dollar (NZD)

Exchange rate :                         1 USD = NZD 1.20 as of 11-10-2013

 

Summarized Financial Information

 

Consolidation type :                   Group Consolidated                    Group Consolidated

Currency :                                 New Zealand, Dollar (NZD)          New Zealand, Dollar (NZD)

Denomination :                          (x1) One                                    (x1) One

Date of financial year end :          30/06/13                                    30/06/12

Length of accounts :                   12 months                                 12 months

Sale turnover / Income : 1,131,847,000                            1,336,813,000

Gross profit :                             285,972,000                              298,667,000

Profit before tax :                       -299,892,000                             28,603,000

Net income :                              -304,921,000                             25,262,000

Non current assets :                   130,927,000                             455,504,000

Current assets :                         488,581,000                              524,968,000

Inventories :                               243,650,000                              239,402,000

Total assets :                            619,508,000                              980,472,000

Current liabilities :                      272,876,000                              259,311,000

Non current liabilities :                90,526,000                                143,387,000

Total liabilities :                          363,402,000                              402,698,000

Share equity :                            256,106,000                              577,774,000

Retained earning : -                    359,275,000                              -34,340,000

Comments : The group’s consolidated financial information above relates to the Subject’s Parent Company PGG Wrightson Limited and all its subsidiaries which includes the Subject.

Info: The net loss reported by PGG Wrightson Limited in 2013 includes a goodwill impairment charge of NZ$321.1 million. This goodwill was primarily due to an accounting entry from the 2005 merger of PGG and Wrightson.

 

 

OPERATION DETAILS

 

Main activities :              The Subject engages in export of New Zealand wool.

The Subject is the export arm of PGG Wrightson Limited and exports New Zealand wool to more than 30 countries around the world.

The Subject operates as a wholly owned subsidiary of PGG Wrightson Limited which is quoted on the New Zealand Stock Market under the code PGW.

PGG Wrightson Limited is New Zealand's principle nationwide woolbroker and the world's largest supplier of crossbred wools. PGG Wrightson handles and markets all types of wool using a variety of sales methods including auction, private sale and forward contracts.

PGG Wrightson sells to a bench of 27 wool exporting companies, including its own subsidiary export company, Bloch & Behrens Wool (NZ) Limited (Subject).

Note:                            PGG Wrightson Limited is known to be New Zealand’s largest forage and agricultural services company.

The Subject is ultimately owned by Agria Corporation.

Agria Corporation (NYSE: GRO) is an international agricultural company with operations in China, South America, New Zealand and Australia. Agria operates three principal business lines: China seeds, international seeds and agriservices. In China, Agria engages in research and development, production and sale of seed products, including proprietary field corn seeds, edible corn seeds, vegetable seeds, grass seeds and

forage. Agria owns through Agria Asia a 50.22% equity interest in PGG Wrightson Limited, New Zealand’s largest forage and agricultural services company.

 

Product & services :       Greasy and scoured New Zealand wool

Purchases

Local :                          Yes

International :                 None reported.

Sales

Local :                          Yes

International :                 Worldwide: Europe, China

Key events :                  13 August 2013

Agria's New Zealand Listed Subsidiary PGG Wrightson Reports Annual

Results for the Year Ended June 30, 2013

 

Agria Corporation (NYSE: GRO) (the "Company" or "Agria"), an

international agricultural company with operations in China, South America, New Zealand and Australia, today announced that its New Zealand listed subsidiary, PGG Wrightson Ltd. (NZSE: PGW) ("PGW"), has released its annual financial results for the fiscal year ended June 30, 2013. These results will be consolidated in the Agria's results for the year ended June 30, 2013.

 

For the fiscal year ended June 30, 2013, PGW reported operating earnings before interest, tax and depreciation (Operating EBITDA) of NZ$45.8 million and a net loss of NZ$306.5 million. The net loss reported by PGW includes a goodwill impairment charge of NZ$321.1 million. This goodwill was primarily due to an accounting entry from the 2005 merger of PGG and Wrightson. A number of factors, including PGW's share price, slower than expected recovery and a range of external variables, led the board of directors of PGW to conclude that a write-down of historic goodwill was appropriate. Excluding the impact of this non-cash charge, PGW would have reported net income of NZ$14.6 million. The goodwill write-down has no impact on PGW's operations or cash flow. PGW's fiscal year operating cash flow was NZ$39.3 million.

 

PGW paid a dividend of NZ$0.022 per share in March and an additional dividend of NZ$0.01 per share will be paid to shareholders registered as of the record date of August 30, 2013. The dividend will be paid on September 13, 2013.

 

PGW's results were impacted by challenging farm trading conditions in both New Zealand and Australia. PGW's retail, wool and irrigation and pumping businesses performed strongly with improved market share across a number of key categories. Sales grew in many rural supplies stores, and the irrigation and pumping business showed excellent growth. Conversely, livestock, real estate, seeds and grain faced challenges.

Drought  in the North Island of New Zealand and lower market values for lamb impacted farmer profitability, while the Australian seed business experienced poorer than expected sales due to the timing of rainfall in dairying regions.

 

Sir John Anderson, PGW's Chairman, noted, "We expect to see continued improvement in the fundamental performance of the business through 2013/14 based on stronger agricultural commodity prices and assuming a return to normal conditions on farms."

 

Alan Lai, Agria's Executive Chairman, commented, "PGW is a significant strategic investment for Agria. By taking a one-time non-cash goodwill impairment charge of NZ$321.1 million, PGW is resolving legacy accounting issues which will aid better understanding of its performance. The charge does not impact Agria's business operations or cash flow. In fact, PGW has declared a dividend again and is committed to returning cash to its shareholders."

 

Mr. Lai continued, "PGW is important to our global strategy and we believe it will continue to contribute to our growth. With an outlook for improving performance, we look forward to PGW delivering value to investors."

 

About Agria Corporation

 

Agria Corporation (NYSE: GRO) is an international agricultural company with operations in China, South America, New Zealand and Australia. Agria page operates three principal business lines: China seeds, interna tional seeds and agriservices. In China, Agria engages in research and development, production and sale of seed products, including proprietary field corn seeds, edible corn seeds, vegetable seeds, grass seeds and forage. Agria owns through Agria Asia a 50.22% equity interest in PGG Wrightson Limited, New Zealand's largest forage and agricultural services company. For more information about PGG Wrightson Limited, please visit

www.pggwrightson.co.nz. For more information about Agria Corporation,

please visit www.agriacorp.com.

Source: wwwir.agriacorp.com

 

May 16, 2013

Agria brushes off Wrightson profit warning as ‘temporary setback’

 

Agria Corp, the New York Stock Exchange-listed agriculture investor whose top executives left last year, has brushed off local subsidiary PGG Wrightson's profit warning as a "temporary setback" and is still optimistic about the long-term outlook for the New Zealand rural services firm.

 

Executive chairman Alan Lai, who is also a director on Wrightson's board, says the New Zealand firm's forecast that annual earnings will be between 13 percent and 27 percent lower than a year ago was because of "weather and other conditions outside of our control" and he is still "optimistic about the long-term outlook for PGW and Agria."

 

The Singapore-based firm with Chinese operations owns a majority stake in Wrightson.

 

"We are committed and focused on building a durable franchise and institution that can thrive in strong climatic and weather conditions, but can limit the downside in adverse conditions as we continue to build our business in different geographies around the globe," Mr Lai says in a statement to the NYSE.

 

"We expect to both grow quickly and reduce the volatility in our results."

This week Wrightson said earnings before interest, tax, depreciation and amortisation are expected to be between $40 million and $48 million in the 12 months ending June 30, down from $55 million in 2012. The shares plunged 10 percent on the warning and traded at 35 cents apiece yesterday.

Agria completed a $144 million partial takeover of Wrightson in a deal that brought on China's New Hope International and Ngai Tahu as minority shareholders in the holding company.

Wrightson is the major source of revenue for Agria, which it uses to run its international operations across China, New Zealand, Australia and South America.

Agria's shares dropped 3.7 percent to $US1.05 on the New York Stock Exchange, having climbed 58 percent this year. The company's market capitalisation of $US60.4 million is a 46 percent discount to the value of its stake in Wrightson, whose market cap is $264.2 million, or $US217.9 million.

Source: www.nbr.co.nz

 

14 November 2012

LIC defends Agria loan

 

Livestock Improvement Corporation says it is "comfortable" with the time extension given to PGG Wrightson’s controlling shareholder, Agria Singapore, to repay a $10 million loan.

But some farmer-shareholders of LIC, a Hamilton-based dairy genetics co-operative company, expressed concerns about the deal at LIC’s annual meeting today in Hamilton.

Shareholder Richard Myers questioned the rationale for the LIC loan.

"I still fail to see the reason for making the loan. I see it as a $10 million loan to a Chinese company to facilitate their investment in PGG Wrightson.How does it fit into the strategy of LIC?

 

"It’s a loan, it seems, with some hope to get a piece of some opportunity that may arise in future to get a part in a seed company."

LIC chief executive Mark Dewdney told the meeting that LIC originally provided a $NZ10m loan to Agria Singapore for 18 months, which fell due for repayment on 31 October.

 

The loan was made to support Agria to take control of PGG Wrightson.ANZ loaned Agria $53m, of which $28m had been repaid, Dewdney said.Before the loan fell due, Agria asked ANZ and LIC to extend the loans. "ANZ were prepared to do this for a further period to April 2014 and, as the subordinated lender, LIC were then required to do the same,’’ Dewdney said.

 

"Our position is that we are comfortable to stay there. We are comfortable to maintain our relationship with Agria. We have a good relationship with PGG Wrightson."

Benefits of providing the loan included LIC getting a position on the Agria board and an inside view of what was happening at PGG Wrightson,

Dewdney said.

 

"Technically Agria haven’t defaulted on the loan. They have paid all interest as it has fallen due."

 

Dewdney said LIC supported Agria’s takeover move, because it believed there was potential to improve grass species for New Zealand.

"We wanted to influence the future direction of PGW’s grass research and development for the benefit of New Zealand farmers.

"Our intention was to put ourselves in a position to consider investing in a separate AgriTech business, if such a standalone business was established by PGW."

Farmer-shareholder Graeme Edwards said shareholders might be entitled to a "degree of nervousness" with their co-operative venturing "outside core business".

He questioned the wisdom of LIC essentially following the leader, with "ANZ driving the loan extension’’.

 

He asked if LIC would have extended the loan if it had not been the subordinate lender.Dewdney said LIC had not had a choice on that matter, as LIC had been the subordinate lender from the beginning.

"When ANZ extended, we needed to extend as well, as ANZ are driving the terms of the loan."

 

He said that overall, LIC’s involvement had met its expectations.

Agria, ANZ and LIC have agreed there will be a $10m, part-repayment of the total loan by mid-December, with LIC to receive at least half of that. The interest rate has been increased on the balance of the loan. Agria is able to repay the loan balance at any time before 2014.

 

"LIC’s security for the loan is PGW shares, and they would have to trade at under 10 cents a share to fall below the value of our loan – this compares to the current share price around 35 cents – we are comfortable with this," Dewdney said.

"Maintaining our loan to Agria also allows us the potential to participate if there is a split-out of the AgriTech business by PGW. We would consider this if and when it became a real option."

Agria is a New York Stock Exchange-listed, Cayman Islands-registered, Singapore-controlled company with offices in China.

Source: www.stuff.co.nz

 

24 April, 2011

Agria Singapore's Partial Takeover Offer of PGG Wrightson Limited Has Become Unconditional Agria (Singapore) Pte Ltd (Agria Singapore) advises that all of the

conditions to its takeover offer dated 24 January 2011 for 38.3% of the issued ordinary shares in PGG Wrightson Limited not already held by it (Offer) have been satisfied. Accordingly, the Offer is now unconditional.

 

Agria Singapore will be jointly owned, directly or indirectly, by Agria Corporation (NYSE: GRO) and New Hope, along with an investment by Ngai Tahu Holdings, and certain financing provided by Livestock Improvement Corporation Limited.

 

The offer period has closed and final determination of the number of shares to be acquired from each acceptor of the Offer will be made in accordance with the New Zealand Takeovers Code and the Offer.

 

About Agria Corporation

 

Agria Corporation (NYSE: GRO) is a China-based company with

investments in the agricultural sector. For more information about Agria

Corporation, please visit www.agriacorp.com.

 

About New Hope New Hope is one of China's largest agricultural and food corporations. The Group has revenue in 2010 of approximately RMB 60 billion (equivalent to approximately NZ$12.1 billion) and operates throughout China, and in South-East Asia. New Hope Group has four large business units -- agriculture and food (accounting for 85% of revenue),

chemicals and resources, real-estate and financial businesses.

About Livestock Improvement Corporation Limited (LIC) LIC is a New Zealand co-operative enterprise, owned by transacting dairy farmer members. LIC's core purpose is to help farmers become more efficient and profitable by genetically improving their animals, and by providing information, systems and technology that make it easier to farm. LIC has over 12,000 farmer customers in New Zealand and overseas, with full year 2010 sales of approximately NZ$136.0 million (approximately US$107.0 million). LIC employs the equivalent of approximately 600 full-time employees in New Zealand and over 1,700 in seasonal staff. LIC

operates a dedicated, direct sales team of 75 staff in New Zealand,

supported by a 45 seat national call center.

 

About Ngai Tahu Holdings

Ngai Tahu Holdings is a long-term strategic investor with a particular focus

on New Zealand's South Island commercial and rural ventures, committed

to supporting growth in the rural sector through global partnerships and

relationships.

Source: www.ir.agriacorp.com

 

25 December 2010

Agria and New Hope look to pastures new

WELLINGTON, New Zealand - PGG Wrightson Ltd shares rose the most in

14 months after a Chinese company bid to take partial control of New

Zealand's largest agricultural services company.

 

Zhongshan-based Agria Corp and New Hope Group, a Chinese agriculture

and food group, offered to pay 60 New Zealand cents (45 cents) a share to

raise their stake to 50.01 percent, according to a statement issued after the

close of trading on Thursday. The offer is 25 percent higher than the

closing price on Dec 23.

 

PGG Wrightson gained 16.7 percent to 56 New Zealand cents as of the 4

pm close in Wellington. The gain was the biggest since October 2009.

The offer was made by Agria (Singapore) Pte Ltd, a company held by Agria

and New Hope that currently has a 19.01 percent stake in Wrightson. The

Christchurch-based company sold an 11 percent stake to Agria in October

to help repay a NZ$200 million ($149 million) loan after a plunge in

commodity prices and the value of Wrightson's investment in a Uruguay

dairy venture forced a renegotiation of finances.

 

"PGW has underperformed expectations in recent times, including a recent

profit downgrade," Agria Chief Executive Officer Xie Tao said in the

statement. "PGW's business requires restructuring and a refocus on the

core businesses."

 

Pyne Gould Corp, Wrightson's second-biggest shareholder, agreed to sell

its 18.3 percent stake in the company to Agria, according to the statement.

Wrightson is supportive of the offer, according to a separate statement

issued by Pyne Gould on Friday. Wrightson recommended its investors

don't sell shares until the offer is evaluated, the company said in a

regulatory filing.

 

Agria will pay NZ$141 million for the new stock and won't increase its

shareholding above 50.01 percent if the bid is successful, or make a further

offer at a higher price for a period of 12 months, according to the

statement.

 

The offer is conditional on government approvals. New Zealand this week

rejected a bid by China's Natural Dairy (NZ) Holdings Ltd to buy land

assets because the application didn't meet "good character" criteria. The

rejection came after the government in September gave ministers greater

power to quash sales of large farm blocks and other sensitive land amid

rising concern about foreign ownership in key industries.

 

Agria, Wrightson's biggest shareholder, develops corn seed varieties and

runs sheep-breeding operations and tree nurseries in China. The company

acquired an 11 percent stake in Wrightson in October last year and another

8 percent a month later.

 

Chengdu-based co-operative New Hope is one of China's largest

agricultural and food companies and reported revenue of about $60 billion

yuan ($9 billion) in 2010, according to the statement.

 

Wrightson on Friday appointed George Gould managing director starting

Feb 1, according to a statement sent to the stock exchange. He replaces

Tim Miles, who resigned on Oct 19 after the company said it was

considering a new strategy.

 

The company last week lowered its full-year earnings forecast, citing

difficult first-half trading conditions on the nation's farms.

Source: www.chinadaily.com.cn

 

Property & Assets

Premises :                    The Subject operates from the verified heading address consisting of an

administrative office.

Branches :                    In addition, the Subject operates from an office located at:

Lyngby Hovedgade 98, Stuen, K6

Lyngby 2800 Kgs

Denmark

page 18 / 22

Tel: +45 45885533

Fax: +45 45885536

 

 

SUMMARIZED COUNTRY RISK

 

Gross Domestic Products (GDP) & Economic Overview

 

Central bank :                                        Reserve Bank of New Zealand

Reserve of foreign exchange & gold :       US$ 20.562 billion

Gross domestic product - GDP :            US$ 180.548 billion

GPP (Purchasing power parity) :             126.628 billion of International dollars

GDP per capita - current prices :             US$ 40,454

GDP - composition by sector :                agriculture: 4.7%

industry: 24%

services: 71.3%

Inflation :                                               2009: 2.1%

2010: 2.3%

2011: 4%

Unemployment rate :                              2009: 6.1%

2010: 6.5%

2011: 6.5%

Public debt

(General Government gross debt as

a % GDP):                                            2009: 26.1%

2010: 32.3%

2011: 37%

Government bond ratings :                      Standard & Poor's: AA+/Stable/A-1+

Moody's rating: Aaa

Moody's outlook: STA

Market value of publicly traded

shares:                                                             US$67.061 billion

Largest companies in the country :          Westpac Limited, Transpower, Fletcher Building Limited, National Bank of New Zealand, Fonterra Co-Operative Group Ltd, Air New Zealand Limited, The Warehouse Group Limited, Progressive Enterprises Ltd

 

Trade & Competitiveness Overview

 

Total exports :                                       US$33.24 billion

Exports commodities :                           Dairy products, meat, wood and wood products, fish, machinery

Total imports :                                       US$31.11 billion

Imports commodities :                            Machinery and equipment, vehicles and aircraft, petroleum, electronics,

textiles, plastics

Export - major partners :                         Australia 22%, US 11.5%, Japan 9.2%, China 5.3%, UK 4.6%

Import - major partners :                         Australia 20.7%, China 13.4%, US 9.7%, Japan 9.5%, Singapore 4.9%,

Germany 4.7%

FDI Inflows : 2008:                                 US$4,598 million

2009: US$-1,293 million

2010: US$561 million

FDI Outflows :                                        2008: US$462 million

2009: US$-308 million

2010: US$589 million

Best countries for doing business :          3 out of 183 countries

Global competitiveness ranking :             25 (ranking by country on a basis of 142, the first is the best)

 

Country and Population Overview

 

Total population :                                   4.37 million

Total area :                                            270,467 km2

Capital :                                                Wellington

Currency :                                             New Zealand dollars (NZD)

Internet users as % of total

population:                                            83%

 

 

PAYMENT HISTORY

 

Purchase Term

Local :                          Prepayment, Bank transfer, D/P, Credit up to 120 days

 

Sales Term

Local :                          Bank transfer, D/P, Credit up to 120 days

International :                 L/C, Prepayment, Telegraphic transfer, D/P, Credit up to 120 days

 

Trade Reference/ Payment Behaviour

 

Comments :                  As local and international trade references were not supplied, the Subject's payment track record history cannot be appropriately determined but based on our research, payments are believed to be met without delay.

 

Investigation Note

 

Sources :                      Interviews and material provided by the Subject


 

FOREIGN EXCHANGE RATES

 

Currency

Unit

Indian Rupees

US Dollar

1

Rs.61.16

UK Pound

1

Rs.97.77

Euro

1

Rs.82.78

 

 

INFORMATION DETAILS

 

Report Prepared by :

SDA

 

 

RATING EXPLANATIONS

 

RATING

STATUS

 

 

PROPOSED CREDIT LINE

>86

Aaa

Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums

 

Unlimited

71-85

Aa

Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums

 

Large

56-70

A

Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums

 

Fairly Large

41-55

Ba

Overall operation is considered normal. Capable to meet normal commitments.

 

Satisfactory

26-40

B

Capability to overcome financial difficulties seems comparatively below average.

 

Small

11-25

Ca

Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity

 

Limited with full security

<10

C

Absolute credit risk exists. Caution needed to be exercised

 

 

Credit not recommended

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NB

New Business

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This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

 

Financial condition (40%)            Ownership background (20%)                 Payment record (10%)

Credit history (10%)                    Market trend (10%)                                Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.