New Zealand Farming Systems Uruguay is urging shareholders to sit tight on takeover offers as the bidding war for the company heats up.

The FSU board is telling shareholders not to accept either the 55-cents-per-share offer from Olam International or the 60 cent offer from Uruguayan company Union Agriculture group.

An independent report has valued the shares at between 65 and 79 cents each. NZFSU chairman John Parker isn’t coy about the company’s need for more funds.

“The basis is pretty simple. It’s drastically lower at 55 cents than the independent evaluation which puts the midpoint of the range at somewhere around 70 cents."

A mystery third bidder has also entered the race.

Mr Parker wouldn’t divulge details, but says the offer is for a minority stake, and would involve new equity being issued.

"There is another discussion going on with another potential investor who [is] following another approach, in saying they are not seeking to take over a majority stake.

"Rather, they are seeking to recapitalise the company and take a minority stake, so that’s rather different.”

Farming Systems is making no secret of its desire for more capital. On Monday it posted an annual operating loss of US$10.4m