New Zealand Farming Systems Uruguay is urging shareholders to hold on to their shares following a takeover offer from the company's biggest investor Olam International of Singapore.
Olam, which owns 18.5% of Farming Systems Uruguay, is offering 55 cents per share for the rest of the farm developer, in a deal worth $110 million.
It already has the support of the second largest shareholder, PGG Wrightson, giving it at least another 11.5%, though Olam needs more than 50% for the deal to proceed.
Farming Systems Uruguay has told shareholders to wait until an appraisal report is done on the offer and says it's close to buying out the management contract held by PGG Wrightson.
PGG won't comment about the talks or the potential price.
PGG supports the takeover and is prepared to sell its stake, regardless of whether it retains the contract or becomes a preferred supplier.
PGG says the company's own seeds and rural services businesses in South America are not affected by the proposed takeover.
Shares in Farming Systems Uruguay continued to climb on Tuesday.
Farming Systems Uruguay's stock shot up 29% on Monday and rose another 1 cent on Tuesday. They have reached a 13-month high of 54 cents.
PGG Wrightson shares rose 3c to 50c on Monday.
