Superfert eyes Ravensdown facilities
WA fertiliser supplier Superfert is mounting a bid to buy Ravensdown's facilities after the New Zealand-based co-operative announced a decision to sell out of WA.
Ravensdown chief executive Greg Campbell said last week that Ravensdown was negotiating with interested parties to sell its WA operations, citing difficult market conditions leading to "unacceptable results".
Mr Campbell put the unaudited trading loss in WA for the financial year in the order of $NZ 9 million on the back of smaller losses for the three previous years.
One party showing an interest is Superfert Dongbu, which has proposed a series of meetings in WA next week in a bid to gauge interest from shareholders.
In an open letter to Ravensdown shareholders in this week's _Countryman _, Superfert chief executive Leroux Beyers said Superfert was keen to help shareholders get the best return possible from the facilities WA farmers have invested in and built, originally through the United Farmers Cooperative.
"Superfert would like the WA Ravensdown shareholders to take back the WA facilities into a co-operative structure and work with Superfert to obtain supply," Mr Beyers states in the letter.
"We expect this will be a far better return to WA shareholders than a sale to a bidder that wants to pay the least amount as possible and the lack of clarity on any return to WA shareholders on shares."
Ravensdown declined to comment on which parties were sizing up its facilities in WA.
Mr Campbell added that its WA losses were a disappointing result especially after a plan last year to turn the business around.
"Ravensdown has encountered its fair share of challenges since it entered WA in 2008," Mr Campbell said.
"With the droughts, a global financial crisis and seesawing grain prices, a number of farmers in WA have had a grim time of it.
"With so many players competing for an increasingly scarce rural dollar, it's no surprise that volumes and margins have been constantly under pressure in WA."
The decision to exit WA will benefit New Zealand shareholders while a redemption program is being developed for 4000 WA shareholders.
Details are expected to be communicated to members as the sale process is completed.
"We're aiming for as smooth a transition as possible," Mr Campbell said.
In the interim, Mr Campbell said Ravensdown would remain in contact with shareholders, staff and agents and it would be business as usual for WA customers.
In a letter to shareholders last week, members were told discussions could take 'some months'.
The buying price is also a key concern and is expected to be in excess of the share capital, which is $26 million.
Former United Farmers Cooperative chairman Rod Madden believes Ravensdown's port assets will attract a strategic premium from grain players who want to secure a foothold in WA's logistics chain.
Ripe for the picking is Ravensdown's Kwinana facility, which is ideally placed to export grain and includes 100,000t of storage.
With new entrants setting up their own facilities in WA including Bunge in Bunbury and the Chinese in Albany, Mr Madden fears it will weaken CBH and its ability to develop and maintain grower-owned infrastructure.
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