WESTERN Australian mining billionaire and grazier Twiggy Forrest is the latest large cattle operator to take a significant financial stake in listed beef supply chain, the Australian Agricultural Co.
Australian Securities Exchange regulations dictate that any investor in a listed stock that reaches 5pc of the company’s overall shares must declare its position, as a Substantial Shareholder.
Mr Forrest’s investment arm, Tattarang, has been actively buying AA Co stock in small parcels over the past two years, yesterday triggering its Substantial Shareholder declaration, amassing a total portfolio as of yesterday of almost 32 million shares, valued at around $35.4 million.
The investment now accounts for 5.31 percent of AA Co’s stock.
In an interesting and perhaps significant parallel, another of WA’s major northern pastoral players, Paul Holmes a Court’s Heytesbury Beef, in November also became a ‘Substantial’ AA Co shareholder, now representing more than 7pc of AA Co stock.
Beef Central interviewed Paul Holmes a Court last week about his company’s recent moves, and his views on AA Co’s financial performance. Click here to view.
Beef Central put a series of questions to Tattarang this morning over its share buy-up. We received the following response from chief investment officer John Hartmann:
“Tattarang is committed to investing in Australian businesses and brands that showcase the best of our country to the world and support local jobs. Our investment in Australian Agricultural Company Limited is part of this commitment.”
“This is a long-term investment for the Tattarang Group,” the statement said.
Recent developments in share-building have set up an interesting period ahead for AA Co and its shareholders, in the lead up to the annual results disclosure in May, and annual general meeting in July.
Certain rights come into play when a shareholder in a publicly listed company hits certain levels, including the ability to call an extraordinary annual general meeting, and blocking stake rights.
The key shareholding thresholds in an ASX-listed Australian company from a Corporations Act perspective are:
- Greater than or equal to 5pc of shares – obligation to file substantial holding notice (as Tattarang has filed this week, and Heytesbury did back in December)
- Greater than 10pc – ability to block compulsory acquisition
- Greater than 20pc – takeovers threshold
- Greater than 25pc – ability to block scheme of arrangement and special resolution
- Greater than 50pc – ability to pass ordinary resolution
- Greater than or equal to 75pc – ability to pass special resolution, and
- Greater than or equal to 90pc – entitlement to compulsory acquisition.
Click here to learn more about the implications when shareholder thresholds are reached on ASX-listed companies.
AA Co shares closed yesterday at $1.63, up 20c on where they say in late January, and close to the highest seen in the past five years. There was a sharp spike in trading turnover for four days between 9-14 February, peaking at around 1.75 million shares daily.
- Twiggy Forrest’s Harvest Road WA beef supply chain, including the Harvey Beef export processing plant, intensive cattle finishing enterprise and five northern grazing properties, yesterday announced its purchase of Balfour Downs from Chinese billionaire, Jack Ma.
- Last year Mr Forrest attacked the animal welfare credentials of major beef processor JBS, and the broader Australian meat processing industry, via a series of statements following JBS’s purchase of Tasmanian salmon farmer, Huon Aquaculture.