Wool Co has extended its capital raising deadline and dramatically reduced the minimum buy in it is asking from farmers in its bid to buy Wool Services International.
So far not enough farmers have backed Wool Co’s proposition to buy up the late Alan Hubbard’s 64 percent stake in Wool Services International.
Wool Co is seeking to raise $40 million to buy Hubbard’s stake with plans to make an offer for the rest of the company.
After initially asking for a minimum buy in of $23,000 from farmers, that number has now been revised down to $9500 and the investment deadline extended to December 9.
Chairman Cliff Heath says Wool Co’s first strategy was to get a lot of money in quickly from farmers was too much an ask and it soon became clear that $23,000 was too high a figure.
"As soon as we went out it became apparent that that wasn’t going to occur, so we listened to the farmer groups and we listened to the banks and they indicated that no, $9,500 was a better figure so that’s why we went to there.
"The second issue that we’ve now clarified exactly is that the cheques would not be banked until the first of February."
Mr Heath says Wool Co still has a reasonable chance of success and that their earlier deadlines for farmers were hampered by incredibly slow rural postal services.
"We’re reasonably confident that what we get in the end depends. And also, farmers aren’t that good at making sure things arrive on the day. So certainly cheques which were supposed to be coming in on the 28th are still turning up today, and tomorrow sort of.
"Where are we at today, I don’t actually know. Are we confident of getting there in the end? Reasonably confident."
Wool Co is a joint venture between Wool Equities and Ocean Partners a merchant bank from Christchurch.
