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NZ money - Source: ONE News -
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Allied Farmers Ltd shareholders have voted in favour of a plan to buy the assets of failed finance company Hanover.
The company says two resolutions were passed at a special meeting on Tuesday in Hawera: the purchase of the finance assets of Hanover Finance and United Finance and a resolution to issue new Allied Farmers' shares as consideration.
The hurdle for approval was 50%, and shareholders gave it strong support with 85% voting in favour.
"Clearly the shareholders in Allied think that the deal would be positive for them," says MacQuarie Private Wealth analyst Ian Witters.
Witters says the level of support may have been a surprise to the company, and gives confidence that the shareholders think they can extract value out of the deal, should Hanover shareholders vote in favour.
The deal needs the approval of 75% of investors in Hanover, and that vote is on December 16.
"That's a harder vote...They're the ones that are most disaffected, the debenture holders in Hanover. However, at this stage the independent director of Hanover is saying that this really is the best offer on the table at the moment and this is potentially better for them," says Witters.
The deal's promoters have been on a road show around the country presenting to investors.
The deal involves Allied Farmers taking over all of Hanover's remaining assets valued at $396 million.
Hanover investors are paid in shares and end up owning most of Allied Farmers' shares.
They receive shares to the equivalent of 72 cents in the dollar, having been paid six cents in the dollar under a moratorium.
Hanover Finance debenture holders are currently forecast to
receive 70 cents in the dollar if the moratorium is allowed to
continue.
