30 Nov 2012

Australian wool offer goes out to shareholders

6:29 am on 30 November 2012

An Australian takeover offer for Wool Services International was sent to shareholders this week.

A company associated with Lempriere, a wool merchant and processor in Melbourne, already has an agreement to buy 75% of the shares of New Zealand's largest wool exporter and is now seeking a total buy out.

WSI chairman Derek Kirke said an independent report with a recommendation to accept the offer will go out next week, and shareholders will have until mid-February to consider the bid.

Lempriere will also have to get approval from the Overseas Investment Office.

There's one other condition that WSI has to meet before the sale can go through. That is new effluent discharge arrangements for the company's Kaputone wool scour north of Christchurch.

The right to discharge into the Waimakariri River expired in July and since there was a short shutdown to instal new technology.

Mr Kirke said the company is still working to get the discharge to the maximum standards required by Christchurch City Council for sewage.

He said it is taking more time to bed down than hoped, but progress is being made.