Farmers say ‘yes’ to rural stores merger

Media release: February 27, 2013

Farmers say ‘yes’ to rural stores merger

Farmer Shareholders in the rural supply co-ops Farmlands and CRT have agreed to merge the two Societies with a majority of Farmlands and CRT Shareholders voting in favour of merger in today’s second special vote.

It means an immediate bonus for Shareholders in both co-ops. A bonus share issue of $32 million shares is being made to shareholders to distribute the retained earnings and unallocated reserves of the two co-operatives prior to merging.

And the two companies will distribute more than $8 million in an interim bonus rebate to Shareholders. This relates to their trading with the two co-operatives over the period 1 July– 31 December 2012. The rebate will be paid in a 60/40 share/cash split.

The decision clears the way for a March 1, 2013 merger of the two businesses, creating a nationwide farm supplies co-op with 54,000 members throughout New Zealand, more than 1,000 staff, 47 farm supplies stores in the North Island and 31 in the South Island and combined historic sales of $2 billion a year.

Farmlands chairman Lachie Johnstone, who will chair the Establishment Board of the merged entity, and CRT chairman Don McFarlane said they were very pleased with the outcome.

“The boards and management of both companies both worked hard to formulate and evaluate the proposal before it was put to Shareholders. It makes a lot of sense and we’re pleased these plans have been endorsed by the Shareholders of both organisations,” they said in a joint statement.

Mr Johnstone said the Establishment Board and management would move quickly to ensure merger gains were captured on behalf of Shareholders.

All Shareholders would shortly receive information about the bonus issues to be completed as part of the new capital structure of the merged co-op, he said.

Mr McFarlane said the quality of the analysis and consultation process was a tribute to both management teams and Boards, and he was delighted the merger would proceed.

“It’s an historic milestone for both Societies, and one that I am sure we will look back on as a valuable and worthwhile step,” he said.

ENDS

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