The Silver Fern Farms meat co-operative has issued an independent adviser's report on a proposed partnership with PGG Wrightson which it says identifies some significant benefits.
Silver Fern is sending the report to shareholders before a vote is taken next month on the proposal. PGW is offering to buy a 50% stake in the meat co-operative for $220 million.
The analysis from Grant Samuel and Associates, says the partnership would increase Silver Ferns' equity ratio to 80%, making it the "financially strongest company in the New Zealand meat industry".
It values a 50% shareholding in Silver Fern Farms at between $205 - $225 million, putting PGW's $220 million offer at the top end of the range.
The Grant Samuels report says the meat co-op's farmer shareholders would not be disavantaged by PGW acquiring half the business, as they would keep significant control of the company under the proposed partnership conditions.
It says giving away some control to PGW would be a small trade-off for the potential benefits.
Silver Fern needs to get a 75% shareholder vote in favour of the proposal for it to go ahead.
That will be decided at a special general meeting on 8 September.