“We just have a preference to own our investments directly,” he said after declaring a direct 3.634% stake in PGW, from a transfer of shares formerly held in the Agri Asia Investments vehicle.
The change means Agria now controls 46.58% of PGW, down from 50.22%. Earlier in December, Agria Corporation and its executive chairman Alan Lai settled a number of accounting and market issues with the Securities and Exchange Commission in the United States. Lai retired as chairman and a director of Wrightson at the annual meeting in October.
There was no ill-will between the parties, and the shareholding change had been part of sensible, logical decision-making, Sang said. “We’ve got to the stage where we want to do our own thing.”
It coincides with the PGW move to sell the PGW Seeds business, which Ngai Tahu supports.
The iwi had made no decisions on the future of its shareholding, owned by the Ngai Tahu Capital subsidiary. It would be waiting to see how the proposed sale of PGW Seeds to DLF Seeds worked out.
If the sale proceeds, PGW has indicated a substantial return of capital to shareholders is likely.
In that case, it was always better to be in the New Zealand tax system, Sang said.
The Ngai Tahu Farming business is a substantial client of PGW, particularly the forestry-to-dairy farm conversion involving up to 7000ha of land at Eyrewell in North Canterbury that was a major customer of the PGW Seeds business.
Sang is a former chief financial officer at PGW, but the original investment in the Agria Asia-vehicle was made in 2009, after he left PGW and before he started at Ngai Tahu Holdings.
“We’ve got a good relationship with them, and they’re good operators.”
The 27.4 million shares owned in PGW, worth about $13.7m at the 50c a share price on the NZX, weren’t a big investment for Ngai Tahu, he said. The group’s total investments are worth about $1.6 billion.
Trevor Burt, who retired as chairman of Ngai Tahu Holdings in August, has represented the Agria Asia group on the PGW board and as deputy chairman has fronted the strategy review that has led to the sale deal for PGW Seeds.
Burt would continue as a PGW director, Sang said.
The chairman of PGW’s committee of independent directors, Bruce Irvine, said the Agria settlements with the SEC related to events occurring in the US and China before 2014. None of the events involved Wrightson.
His committee would continue to assess any consequences which might arise for PGW, he said in a note to the NZX. This included liaising with the Overseas Investment Commission “regarding any implications concerning the good character of Agria Corporation as a major shareholder”.
Sang said Ngai Tahu had received briefings from Agria on its dealings with the SEC.
