Nufarm seeks value by delisting in NZ

By Phil Boeyen, ShareChat Business News Editor

Monday 25th June 2001

Chemicals company Nufarm (NZSE: NUF) wants to cease trading on the New Zealand Stock Exchange as a way of improving shareholder value.

The rationale for the move is to try to improve the liquidity of the company's stock on the ASX, where it has its primary listing.

Nufarm - previously Fernz - finalised Australia as its home base early last year.

The company has repeatedly complained that its share price is undervalued by the market and MD, Doug Rathbone, says the delisting proposal is motivated by a desire to increase Nufarm's appeal to investors.

Last week Nufarm learned it would be dropped from the much-followed S&P/ASX 200 index at the end of the month, following a reduction in the company's liquidity factor. The S&P ranking criteria only takes into account trades on the ASX.

Mr Rathbone says it is in the best long-term interest of the company and all its shareholders to cease its status as an overseas listed issuer on the NZSE.

"We believe the proposed de-listing in New Zealand will result in a high turnover of shares being traded on the ASX which, in turn, will assist our efforts to re-enter the top 200 index.

"An improved index position and greater liquidity will make the stock more appealing to investors."

It's estimated that around a quarter trades in the company's shares in Australia and New Zealand are via the NZSE.

"An analysis shows that if this turnover had been added to the ASX volumes, Nufarm would have retained its position in the top 200 index," the company says.

Details of a meeting to consider the delisting proposal will be sent to shareholders in the next week.

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