Wellard chief executive Mauro Balzarini has sold a big chunk of his stake in the local agribusiness to a Chinese firm and repaid the company $16.3 million through his private investment vehicle.
Perth-based Wellard announced this morning that Mr Balzarini’s WGH Holdings (Wellard’s largest shareholder) would undertake a refinancing and would immediately repay a $15.8 million separation payment owed to Wellard, plus $500,000 in interest.
WGH has also entered into an agreement with Fulida Group Holdings, a Chinese textile company, to sell 66.3 million Wellard shares in order to extinguish a $US25 million debt.
Once the refinancing is complete, WGH will remain Wellard’s largest shareholder with a 20 per cent stake, while Fulida will emerge as the agribusiness’s second-largest shareholder with a 16.5 per cent interest.
Mr Balzarini has been selling his assets to pay off debt, including his Dalkeith home, which fetched him $13.5 million.
He is also trying to sell off his private jet for around $5 million, and hopes to bring in about $100 million from the sale of farms owned through WGH.
“I am pleased that WGH will be in position to settle the separation payment due to Wellard,” Mr Balzarini said.
“This transaction demonstrates that support for Wellard from long-term investors remains strong.
“We welcome Fulida, who has shown a consistent interest in our industry over a long period, as a significant shareholder in Wellard, giving it exposure to the full international beef supply chain into China and other countries.
“That Fulida has taken an equity interest in Wellard, and agreed to voluntarily escrow its shares, highlights its belief in the long-term future of our business, our industry, and the potential that China represents.”
Wellard shares were higher on the news, trading 27.6 per cent higher to 30 cents each at midday; they last traded around 30 cents per share in late August until the company revealed a $23.3 million net loss for the 2016 financial year.
