4 Feb 2011

Takeover battle looming over PGG Wrightson

11:53 am on 4 February 2011

A takeover battle for the rural services company, PGG Wrightson may be in the offing.

A Canadian company, Agrium, is understood to be considering a full takeover offer for PGG Wrightson, which is already facing a $141 million takeover bid from its largest shareholder, Agria of China.

PGG Wrightson says it received a credible approach from an unnamed party, which has been given access to PGG Wrightson's financial accounts.

The unnamed party is thought to be Agrium, which has a half stake in RD1, along with Fonterra, after buying the Australian wheat company, AWB, last year.

If it does make a bid, the offer is likely to trigger concerns about the impact on competition in the rural services market.

PGG Wrightson's independent directors have reiterated that shareholders should do nothing in the meantime.

The company's response to Agria's offer is due on Monday.