Tue, 08 Dec 2009 6:14p.m.
By Adam Ray
An overwhelming majority of Allied Farmers shareholders have voted in favour of a merger with troubled finance company Hanover.
But the deal is not entirely done - it still depends on the opinions of Hanover investors, who will cast their vote next week.
Allied's shareholders have a history of fighting with management, so they got the hard-sell from chairman John Loughlin.
"I think it's quite a unique opportunity to bring strength to both our rural and financial business," he said.
Under the deal, rural services company Allied Farmers would take over Hanover's loans, giving Hanover investors shares in the company.
The deal needed the backing of at least half of Allied shareholders today.
"It was over 90 percent in favour of both resolutions, which is a stunningly good outcome," says Mr Loughlin.
Hanover's been in a moratorium since last December, but with its share price struggling, Allied's had problems too.
Hanover owes $500 million to thousands of investors, and that has left some Allied shareholders worried.
"I feel its a ludicrous debt, ludicrous to be taking over a company so much in debt," says Alan Jenkins.
It is now left to Hanover's investors to say yes or no, and some have been openly hostile toward current management, saying they'd be better off going with Allied.
More than 100 Hanover investors have already asked sharebroker Chris Lee to cast votes on their behalf. Mr Lee says 99 percent of them are in favour of merging with Allied.
Hanover investors have their vote next Wednesday. It needs three-quarters of them to support it.
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