Fonterra is expecting strong interest from overseas investors in a shareholders' fund that forms part of the co-operative's share trading proposal.
Fonterra's 10,500 dairy farmers have received details of how the Trading Among Farmers (TAF) scheme will work and will vote whether to support or reject the plan later in June.
If approved, TAF would allow farmers to trade shares between themselves and also allow for a separate Shareholders Fund from which outside investors could buy the dividend rights of farmers' shares without having voting powers
Fonterra chief financial officer Jonathan Mason expects considerable interest from New Zealand retail investors and Australian and other overseas insitutions in the fund, given the cooperative's $800 million bond issue was fully suscribed in 2009.
"We have a $5 billion debt book. Much of that's offshore. We haven't had any formal roadshows per se but we have had some initial soundings and there's interest in Fonterra everywhere."
A maximum of 20% of total shares will be able to be traded in the fund, but Fonterra expects the fund to normally operate at 7 - 13% per cent of total equity
Critics say opening up the cooperative to outside investment could result in a group of investors with an interest in keeping the dividend high and the milk price low.
But Fonterra chairman Sir Henry van der Heyden says there are controls in place to prevent that happening.