Fonterra happy with notes demand

By Phil Boeyen, ShareChat Business News Editor

Thursday 22nd November 2001

Dairy giant Fonterra says its expecting strong trading interest in its capital notes when they list next week.

The group went to the market for $200 million in notes earlier this month and the offer was fully allocated within a few days of opening on November 5.

Bryce Houghton, Fonterra's group controller, says the overwhelmingly positive response from public investors is pleasing.

"We see this as a positive sign of an active and liquid secondary trading market, expected to operate from 3 December."

The Fonterra notes have an initial minimum interest rate of 7% through to July next year. After that it will be reset annually to a margin over the 12 Month government stock rate. At the current Standard & Poor's credit rating of A+ for the Notes, this margin is 1.7%.

"The notes enable the public to invest in the dairy industry without conferring any ownership rights," says Mr Houghton. "The keen interest shown in the notes is illustrative of New Zealanders' confidence in the dairy industry."

Ownership of Fonterra remains restricted to New Zealand dairy farmers in proportion to supply.

Comments from our readers

No comments yet