7 May 2013

GPG sells shares in Ridley

8:10 pm on 7 May 2013

Guinness Peat Group has agreed to sell its 19.5% shareholding in Ridley Corporation for about $A54 million to California-based AGR Partners.

Ridley, which sells animal feed, says AGR typically seeks minority stakes in private and public companies in the food and agriculture sectors.

The proceeds imply GPG sold its shares for about A90 cents each.

Ridley shares have fallen sharply from $1.13 since 22 March when the company issued a profit downgrade.

It blamed the downgrade on price pressures in the Australian dairy industry, fierce competition and export restrictions to certain Asian countries related to bird flu outbreaks.

Managing director John Murray says AGR has developed an understanding of agribusiness over a long period of time and he expects having the American company as a shareholder will be positive for his company.

He says business remains tough as the dairy sector in Australia remains depressed even though milk prices have recovered.

Ridley reported a near $A13 million loss for the six months ended December.