Rural shake-up helps Allied Farmers' shares

Investors are punting on the possibility of Allied Farmers being sucked into the rural services industry shake-up.

But chairman Brian Train says the Taranaki-based company has not talked to any of its rivals about mergers or consolidation.

Allied Farmers shares have jumped 50c to $2.50 since last Friday in the wake of an industry shake-up.

Allied is the only listed rural services company that has not become embroiled in the consolidation dance.

Last Friday, Wrightson outbid a Fonterra-Pyne Gould Guinness partnership for a cornerstone stake in Williams & Kettle.

Wrightson has since launched a full takeover bid for William & Kettle.

Speculation that PGG and its Fonterra subsidiary, RD1, may regroup and make a play for Allied appears to be behind the share spike.

But Train said there was absolutely nothing material to the business that could have driven the rise.

"We just carry on doing our thing, keeping the shareholders and the clients happy. We watch over the parapets and see what the rest of the world does."

Train said although it was a good lift, it was on a relatively small volume of trades.

It appeared as if a few "mum and dad" investors were taking a punt because the sector was hot right now.

Allied Farmers had no need to consolidate. Its last annual result was a good one with profit up 60 per cent.

PGG chief executive Hugh Martyn said he believed the consolidation of the rural services sector was still very much "in play".