Group aims to slam door on southern raid

By PHILIPPA STEVENSON

Like Musketeers, three Hawkes Bay farmers hope uniting an army of minor shareholders will rescue their Richmond meat company from southern invader PPCS.

Former Richmond director James Aitken and fellow farmers Tom Crosse and John Culwick have formed a holding company, Richhold, in a bid to gain control of Richmond after a series of moves by South Island-based PPCS sidelined hundreds of small, mostly farmer shareholders.

The large southern cooperative gained a holding in Richmond by the back door in February last year by taking a one-third stake in Maori investment company HKM Nominees, which owns 25.5 per cent of Richmond.

In August, it said it wanted to buy 51 per cent of Richmond, and in January boosted its stake in HKM to 67 per cent.

Since then, PPCS has bought about another 3 per cent of Richmond on the open market.

Yesterday, the three Richhold directors, with 12 promoters, began making verbal offers to Richmond shareholders of a scrip-for-scrip deal of one Richmond share for one in Richhold.

By law, they can make the offer only to family, friends or close business associates but were confident they could get about eight million shares, or 19.9 per cent of the total shareholding, to give "notice and pause" of an intention to gain a majority shareholding.

Mr Aitken said Richhold was being scrupulous about only dealing with the prescribed shareholders and was turning away others.

"We've said: 'No. We really want you but by law we cannot accept you until we've done notice and pause. But hey, don't go away. We really want you. We're just doing it by the book'."

After gaining the threshold, under the Richmond constitution the group will have to wait 15 days before it can stand in the market.

Mr Aitken said: "We will keep going after 19.9 per cent until everyone who wants to come in is in."