PGG shareholders approve Wrightson merger

Pyne Gould Guinness (PGG) shareholders today overwhelmingly approved the proposed merger with rural services rival Wrightson today at a meeting in Carisbrook, Dunedin.

Over 99 per cent of shareholders endorsed the plan, a similar ratio given by Wrightson shareholders on Wednesday.

The merged company, to be known as PGG Wrightson, will be the country's largest listed rural services company with annual revenue of $1 billion and a market capitalisation of $510 million.

The proposal has Commerce Commission approval and is backed by the major shareholders of both companies -- Craig Norgate's Rural Portfolio Investments, which owns 50.01 per cent of Wrightson, and Pyne Gould Corporation which owns 55.4 per cent of PGG.

PGG chairman and PGG Wrightson chairman-elect Bill Baylis told Radio New Zealand the new company would be operating from next month once formalities such as court approval had been dealt with.

"We are convinced, with the way the rural sector servicing business is going, that scale is very important -- to have at least one strong, national, full services company and by combining the two there are significant savings in administration and back office costs."

He said there would be a significant increase in the new entity's buying power and it would be to increase spending in research and development.

The company is searching for a chief executive but has appointed divisional managers.

- NZPA