Seeka trims foreign ownership

Seeka’s biggest shareholder, Farmind Corp, will cut its stake in the fruit grower to reduce the company’s foreign ownership below the Overseas Investment Office screening threshold.

At yesterday’s annual meeting, the Te Puke-based company told shareholders its Japanese investor Farmind would that day transfer a 6.55 per cent stake in Seeka to New Zealanders in an off-market trade.

Farmind owned 16 per cent as of December 31, making it Seeka’s biggest shareholder, but after the transaction it will drop to second place behind Sumifru’s 12 per cent holding.

More than 25 per cent of Seeka’s shares are owned by overseas people, and “there is potential for this to have a negative effect on Seeka given the nature of our business,” the company said in a slide accompanying chair Fred Hutchings’ presentation published on the NZX.

Farmind’s sell-down will mean Seeka is no longer classified as an overseas person as defined by the law and will let it waive the Overseas Investment Office approval condition on its $40 million acquisition of Kerikeri orchards.

Seeka will monitor its foreign ownership levels, update the market every six months, and “will put overseas investors on notice through a public announcement of the implications of making an investment in Seeka (particularly without OIO approval) and inviting any foreign investor to contact Seeka in advance of investing”.

The company’s focus on foreign ownership comes as politicians review a proposed amendment to the legislation to tighten the foreign investment screening regime.

Seeka shares yesterday fell 0.8 per cent to $6.50.