Allied Finance in takeover bid for Prime Finance

Hawera-based rural services firm Allied Farmers has announced its intention to launch a full takeover offer for Prime Finance.

Allied Farmers has already entered into a conditional lock-up agreement to buy a 51.9 per cent stake in Prime. The lock-up becomes unconditional on April 5.

The offer price would be $2.80 per share, valuing Prime at $15.6 million.

Allied Farmers said it intended to send the takeover offer to Prime shareholders in May.

Allied needs approval from its own shareholders to proceed with the takeover, and will hold an extraordinary general meeting in April to vote on the matter.

Allied chairman John Loughlin said buying Prime would be an excellent opportunity to grow Allied's finance business.

"We've had our own finance company for many years, and we've had a strategy to grow it," he told NZPA.

We've grown it quite successfully organically and this is just a natural progression from that."

Prime is unlisted and has been operating for more than 20 years.

Shares in Allied Farmers last traded yesterday at $2.20, having ranged between $2.00 and $3.25 over the past 12 months.

- NZPA