Proposed capital structure details
Suppliers will continue to hold shares in MG as they do today. It is proposed that the Share Standard be set at one share for each one KGMS supplied to MG. Suppliers would be able to vote on MG matters based on shares held by them up to the Share Standard. Shares held above the Share Standard will be non-voting. Suppliers will be able to sell any shares they hold in MG above the Share Standard (likely to be subject to limitation in some circumstances). MG has received indicative feedback from all the major banks that if the proposed capital structure is implemented they will attribute a market value to Ordinary Shares in MG when considering the amount of funding that they would make available to individual farming businesses in accordance with their standard asset lending ratios and loan approval policies.
New entrants and growing farm businesses
Importantly, following the proposed capital structure:
• new suppliers will join the co-op on similar terms as they do today;
• no penalties will be incurred by suppliers who do not hold enough shares to meet the Share Standard;
• suppliers can continue to acquire shares via share off-take at the same level as today, being a minimum of 0.65 cents per litre ($0.09 per KGMS), although those shares will be acquired at the market price; and
• Share off-take will be standard for those suppliers not at the Share Standard (it is standard for all suppliers today) and optional for those above the Share Standard.
