Elders to Return in Rural Business

Submitted by Jim Thesiger on 7 September, 2009 - 04:14

Elders (ELD), the Australia based company that survived a collapse just a week back by refinancing its debt through raising $400 million through the institutional investors is planning to return to the rural service market, the chief executive of the company Malcolm Jackman stated yesterday. Mr. Jackman also added that the business is going to see better days this financial year with considerable growth prospects. Elders is going to dispose of assets including plantation business, Futuris Automotive and forestry, he added. It is to be mentioned that a $150 million retail raising is under way for Elders. Mr. Jackman also mentioned that comparing with the earlier debt value in June 30th; the company will be at a much better position by the end of October with its debt being reduced to $200 million. Elders’ had a $1 billion worth of debt at the beginning of the year before it managed to raise $700 million through capital raising and sales of asset.

Mr. Jackman also mentioned that the company is eying on some aggressive targets to achieve and they have the right people in the team to get the job done. Mr. Jackman also tuned down the possibility of Elders Rural Service getting merged with old Dalgetys which is now trading as Landmark saying that the merger is unlikely. The chief executive expressed its high expectations from the rural business of Elders considering Elders’ network in the rural Australia.

While speaking about old Futuris, Mr. Jackman mentioned about usage of debt and minority interests as the key reasons that lead the company into a vulnerable position when the credit market experienced a downfall over the last 12 months. According to the chief executive, Elders and QBE- which is Elders’ key investor is determined to maintain a good relationship as two sides are currently operating an underwriting business for insurance products together.