PGW - PGG Wrightson

[Snoopy]

@Snoopy,
thanks. As you know I'm invested since years in Agria. My holding was 55.000. I reduced it to 10.000 because of the land use right write of.
>>land use rights and non-current prepayments of $57.0 million made in 2013<<

CEO Adam Lai has not explained us why this land use right are worth nothing!! It's a crime.

I presume the Chinese land use rights have been written off because the use of that can no longer deliver any profits to Agria?

He has misused his voting rights and he has a rope team as independent directors.

You previously suggested that Alan Lai has 80% of voting rights in Agria. However page 51 of the latest Agria annual report suggests Alan's interest is actually 47.8%.

As for independent directors being 'independent'. With 47.8% of the votes,an independent director will not be appointed without Lai's approval to be sure. Exactly the same at PGW where Lai controls over 50% of the shares. But this doesn't mean that independent directors have no duty to look after minority shareholders.

One thing I am curious about is how Wah Kwong Tsang is declared an Independent Director of Agria. Yet in New Zealand the same man controlling the same assets becomes a non-independent director? Something doesn't sit right there.

I don't see a real chance for PGW's shareprice to raise in the future. It will always be bonded to the level of dividend they can generate.

If a company pays out all of their earnings as dividends,then it will struggle to raise its share price at the same time. I think this is a given, and understood by most investors in PGW today. Nevertheless in the case of PGW, if they can show an ability to keep paying dividends throughout the rural cycle (even if those dividends fall at the cycle low point), I think there is a fair chance the share price will be rerated, 100% earnings payout policy notwithstanding.

SNOOPY

[BlackPeter]

I for one am very grateful for Agrainvestor keeping us informed of what is happening at Agria on this thread. Agria at last reporting date had 5 directors in total, three of whom were independent.

Joo Hai Lee 59 Independent Director
Sean Shao 58 Independent Director
Wah Kwong Tsang 63 Independent Director

The last name on that list should be familiar, because he is also a director of PGW! Consequently I think it will be highly relevant to this thread exactly what Wah Kwong Tsang signs off as the 'fair value' of PGW today in any independent report, valuing Agria.

Agria's external turnover for FY2015 (YE 30th June, same balance date as PGW) was $US944.714m. Using the 30th June 2015 NZD to USD exchange rate:

$USD944.714m x 1.462 NZD/USD = $NZD1,381.2m

Now, turnover for PGW that year was $NZD1,202.835. (Note that PGW is fully consolidated into the accounts of Agria). By turnover then, PGW makes up

$NZD1,202.835/ $NZD1,381.2m = 87% of the activity of Agria.

So you can see that Agria is largely a leveraged US listed proxy for direct investment in PGW. Accordingly, whatever goes on at Agria is highly relevant to PGW and IMO discussion on Agria should not be on a separate thread.

SNOOPY

Hi Snoopy & Agrarinvestor ... fair enough (re informing PGW share holders), though what I am a bit concerned about is - there are normally two sides to any story, and given that this is the PGW thread am I not sure how many people are around on this thread who might know more about the other side of this particular Agria story (well - I don't).

I understand that Agrarinvestor is unhappy (and looking into the Agria share price he might have a reason for that), but he used several times the word "criminal" to describe Alan Lai's behaviour.

While it is not unheard of that directors of companies break the law, do I still think that we should give them as well the presumption of innocence until proven guilty. Question - is any authority looking into this by Agrarinvestor alleged misconduct? Has anybody been convicted for it by a court of law? If no to both - why not, and why would it be o.k. to call Alan Lai's behaviour criminal?

Agrarinvestor ... just let me ask you a question: If we take your side of the story at face value, than it sounds like you might have a real grievance. What did you do to rectify the situation?

It obviously will not help you to spread rumours in a NZ PGW thread against the majority share holder of PGW. Even if we wanted, we could not even vote for the removal of Agria as a majority share holder - couldn't we? What however might help you is to work together with other Agria shareholders to get what you think is rightly yours.

Did you contact already Ngai Tahu? They hold from memory more than 7% of Agria. What is their sentiment? If they see the story similar to you, than they might have already a handful of lawyers working on this case and be happy to allow other minority share holders to join into a class action?

Or do they have a different view to yours? If yes - why?

[Snoopy]

Hi Snoopy & Agrarinvestor ... fair enough (re informing PGW share holders), though what I am a bit concerned about is - there are normally two sides to any story, and given that this is the PGW thread am I not sure how many people are around on this thread who might know more about the other side of this particular Agria story (well - I don't).

<snip>

What however might help you is to work together with other Agria shareholders to get what you think is rightly yours.

Did you contact already Ngai Tahu? They hold from memory more than 7% of Agria. What is their sentiment? If they see the story similar to you, than they might have already a handful of lawyers working on this case and be happy to allow other minority share holders to join into a class action?

Or do they have a different view to yours? If yes - why?

Admirable advice BP. But Ngai Tahu is a 7% shareholdler in Agria Asia. Agria Asia has as their principal shareholder Agria Corporation. But Ngai Tahu is not invested in Agria Corporation, which is where Agrainvestor finds himself. Agria Asia is not a listed company. By all means Agrainvestor should team up with other Agria Corporation Shareholders - a good idea. But Ngai Tahu is not one of them.

SNOOPY

[BlackPeter]

Admirable advice BP. But Ngai Tahu is a 7% shareholdler in Agria Asia. Agria Asia has as their principal shareholder Agria Corporation. But Ngai Tahu is not invested in Agria Corporation, which is where Agrainvestor finds himself. Agria Asia is not a listed company. By all means Agrainvestor should team up with other Agria Corporation Shareholders - a good idea. But Ngai Tahu is not one of them.

SNOOPY

Good point - as indicated, I didn't know a lot about Agria. Looked after your post at their corporate structure - and you are correct - Ngai Tahu owns a share in Agria Asia, not in the Agria Corporation.

AgriaORg.JPG

The only question I now would have - why would anybody want to invest into a company with head quarter in the Cayman Islands. They even warn in their annual reports that people don't need to bother to sue them -

Attachment 7862

and that (small) share holder rights are limited:

Attachment 7861

(all snippets from their 2015 annual report)

Agrarinvestor - did you ever read the Agria annual reports? It feels they are quite relevant regarding to your concerns ...

[Snoopy]

Agrarinvestor - did you ever read the Agria annual reports? It feels they are quite relevant regarding to your concerns ...

"There is a risk that our existing shareholders may not always act in the best interests of the company."

LOL Say it all!

SNOOPY

[see weed]

Hey Roger, one buyer came in and bought 300,000 at 4.55pm. Was that you? Must be another divy hunter. Looks like sellers disappearing. Looking good for now.

[Beagle]

Not me mate. I'm keeping my powder dry for a big play on something else shortly.

[see weed]

Not me mate. I'm keeping my powder dry for a big play on something else shortly.

Let us know how you get on with big play. I'm looking at a little play on TTK with yield of 11.76%, could be tempted.

[Ellipsis]

If you have access to NBR Paid Content, there is an article today headlined "PGG Wrightson chairman attracts Takeovers Panel attention". Looks like there is a proposed takeover of Agria Corp.

[Beagle]

If you have access to NBR Paid Content, there is an article today headlined "PGG Wrightson chairman attracts Takeovers Panel attention". Looks like there is a proposed takeover of Agria Corp.

PGW sold off aggressively at the close.