Richmond shareholders given 'don't sell' notice

By LIBBY MIDDLEBROOK

Meat processor Richmond is urging its shareholders not to sell out to Richhold, the holding company set up to gain farmer control of the Hawkes Bay company.

Richmond yesterday issued a "don't sell" notice to the stock exchange, promising to send letters to shareholders within the next few days outlining their response to the offer.

Richhold was set up this month by former Richmond director James Aitken and farmers Tom Crosse and John Cullwick to shut out South Island meat processor PPCS, which is keen to raise its indirect shareholding in Richmond.

At least 13 per cent of Richmond shareholders have promised to back Richhold, although by law its directors are allowed to make offers only to family, friends or close business associates under its "notice and pause" to Richmond directors. Richhold has about 10 more days to prepare itself for the takeover.

PPCS, which last year offered to buy 51 per cent of Richmond at up to $2 a share, indirectly holds about 20 per cent of Richmond through HKM Nominees, a Maori investment company that has 25.5 per cent of Richmond.

The Dunedin-based company is keen to buy into Richmond to gain access to the North Island's lengthy production season.

PPCS chief executive Stewart Barnett said he would not comment on the Richhold takeover offer until Richmond had released its own statement.