SI farmers bought most of the $271 million Fonterra dry share issue.The co-operative says South Island farmers collectively purchased a total of 30 million of the $4.52 shares, to a total value of $135.6 million.Central South Island was the biggest purchasing region, buying up 17 million shares reports The Taranaki Daily. Federated Farmers is applauding the $271 million invested in the co-operative by Fonterra’s farmer-shareholders. “In less than stellar economic times, around one-third of Fonterra Co-operative Group’s shareholders have ’shared-up’,” says Lachlan McKenzie.

“The $271 million raised will become udders containing over half a billion dollars when bank facilities are leveraged off it. That’s a sizeable amount from which to look at acquisitions that will add value to the co- operative’s financial performance. “The federation now wants to see Fonterra develop a retentions policy that will build on this war chest. While there’s been much uninformed comment on Fonterra’s debt, the co- operative’s debt-to-debt plus equity ratio trajectory is tracking back to board guidelines of 45-55 per cent.

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Around one third of Fonterra’s farmer shareholders have spent $270.7 million buying up new shares in their co-operative as part of changes to its capital structure. Fonterra’s farmer shareholders have been given the opportunity to adjust their shareholding up or down, to anywhere between 100 and 120 per cent of their current or expected production, at a price of $4.52 per share.

In November nearly 90 per cent of Fonterra farmers voted in favour of allowing themselves to buy into an extra 20 per cent of the co-operative. The move came as part of a three-stage restructuring of the business, as Fonterra said it required more capital to address risks to its balance sheet caused by farmers cashing in their redeemable shares reports The NZ Herald. The new shares would also help Fonterra’s global and domestic growth. Previously, Fonterra farmers were only able to buy one share for every kilogram of milk solids they produced.

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