Elders to sell rural services business

Beef Central, 29/10/2012

In a major development in the rural services sector this morning, Elders Limited has announced plans to sell its Rural Services Division up for sale.

In a four-line statement issued to the Australian Stock Exchange this morning, the board of Elders Limited said it has resolved to commence the sale process as part of an “accelerated strategy to return value to stakeholders”.

“This sale process will occur concurrently with the sale process of Futuris Automotive previously announced to the market,” the statement said.

“The Company is in discussions with its banking syndicate about an appropriate refinancing.

“The market will be kept informed.”

Elders Limited has been approached in recent months by its single largest shareholder Ruralco Holdings to discuss a possible merger between the two rural services companies, but to date Elders has publicly dismissed interest in the plan due to a lack of detail in RuralCo's proposal.

Elders sold a 50 percent stake in its timber company SmartFibre earlier this month and has also been looking to sell its Futuris automotive interiors business since mid-August.

Elders’ Rural Services operations is the largest component of Elders’ operations, and involves supplying physical, financial and advisory inputs and marketing options to Australian and New Zealand farmers. The company has 3400 employees.

Elders posted a net profit of $41.9 million in the first half of 2012.

Elders Ltd shares were trading 24.5c this morning, which compares to a level of around 65c two years ago.


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