The first phase of Fonterra's Trading Among Farmer's share trading scheme will get under away tomorrow when the cooperative starts to gauge the level at which farmers would be prepared to sell the economic rights to their shares in the cooperative.
The process will involve so called "book-builds" when participants are invited to indicate at what level they would be willing to buy and sell at.
Rights to the shares will go into the Fonterra Shareholders Fund, which the investing public will be able to gain access to, and which is expected to be worth not less than $500 million.
If there is a shortfall, Fonterra said it would make up the difference but has said it does not intend to retain permanently the resulting equity.
In the farmer-supplier book-build, farmers will be asked to indicate how many rights to shares they are willing to sell, and at what level, from three indicative ranges - $4.60 to $4.90, $4.90 to $5.20 and $5.20 to $5.50. Another book-build aimed at brokers and investors associated with Fonterra will start on Monday. An institutional book-build will take place on November 26 and 27.