FSF
13/04/2015 09:36
WAV/RULE
NOT PRICE SENSITIVE
REL: 0936 HRS Fonterra Shareholders' Fund (NS)
WAV/RULE: FSF: FCG Waiver from NZX Debt Market Listing Rule 5.2.3
NZX Regulation Decision
Fonterra Co-operative Group Limited (FCG)
Application for a waiver from NZX Debt Market Listing Rule 5.2.3
10 April 2015
Waiver from NZX Debt Market Listing Rule 5.2.3
Decision
1. Subject to the conditions in paragraph 2 below, and on the basis that the
information provided by FCG is complete and accurate in all material
respects, NZX Regulation ("NZXR") grants FCG a waiver from NZX Debt Market
Listing Rule ("Rule") 5.2.3 in respect of the Bonds for a period of 12 months
from the Quotation date for the Bonds, to allow FCG to have fewer than 500
Bondholders who are Members of the Public holding at least 25% of the Bonds.
2. The waiver in paragraph 1 above is provided on the following conditions:
a. FCG clearly and prominently discloses this waiver and its effect in the
Terms Sheet for the Bonds;
b. FCG clearly and prominently discloses this waiver and its effect in its
half-year report, and its annual report for the year the waiver is relied on;
c. FCG discloses liquidity as a risk in the Terms Sheet for the Bonds; and
d. FCG notifies NZXR as soon as practicable if there are any material changes
to the total number of Members of the Public holding Bonds, and/or the
percentage of total bonds held by Members of the Public holding at least a
Minimum Holding.
3. The material information on which this decision is based is set out in
Appendix One to this decision. This waiver will not apply if that information
is not, or ceases to be, full and accurate in all material respects.
4. Rule 5.2.3 to which this decision relates is set out in Appendix Two.
Reasons
5. In coming to the decision to grant the waiver set out in paragraph 1
above, NZXR has considered that:
a. Debt Securities are not typically subject to the same degree of trading
activity as Equity Securities;
b. FCG has advised that it expects the spread of the Bonds will increase to
meet the spread requirements of Rule 5.2.3 over time;
c. the 12-month waiver gives NZXR the opportunity to reconsider the spread of
the Bonds in 12 months' time if FCG considers a waiver is still required;
d. the conditions, contained at paragraph 2(a), (b) and (c) above, will
ensure that prospective Bondholders, as well as those wishing to trade in the
Bonds, are aware that the Bonds may not satisfy the spread requirements of
Rule 5.2.3; and
e. there is precedent for this decision.
Confidentiality
6. FCG has requested that the application for a waiver from Rule 5.2.3, and
NZXR's decision, be kept confidential until the Terms Sheet, and the form of
notice to be provided by FCG under clause 20(1)(a) of schedule 8 of the
Financial Markets Conduct Regulation 2014, has been released.
7. In accordance with Footnote 1 to Rule 1.11.2, NZXR grants FCG's request.
Appendix One
1. Fonterra Co-operative Group Limited ("FCG") is a Listed Issuer with
securities Quoted on the Fonterra Shareholders' Market, and the NZX Debt
Market ("NZDX").
2. FCG intends to make an offer of fixed-rate bonds ("Bonds") to be Quoted on
the NZDX (the "Offer").
3. FCG will publish a terms sheet setting out the main terms of the Bonds
("Terms Sheet").
4. FCG considers that it is unlikely that the Bonds will meet the spread
requirements of Rule 5.2.3 when the Bonds are initially Quoted on the NZDX.
However, FCG anticipates that there will be strong investor demand for the
Bonds, leading to an increase in the spread of the Bonds over time.
Appendix Two
Rule 5.2.3
A Class of Securities will generally not be considered for Quotation on the
NZSX or NZDX unless those Securities are held by at least 500 Members of the
Public holding at least 25% of the number of Securities of that Class issued,
with each Member of the Public holding at least a Minimum Holding, and those
requirements are maintained, or NZX is otherwise satisfied that the Issuer
will maintain a spread of Security holders which is sufficient to ensure that
there is a sufficiently liquid market in the Class of Securities.
End CA:00263002 For:FSF Type:WAV/RULE Time:2015-04-13 09:36:07
