Fonterra Bond Offer Opens 18 February 2010

Fonterra Co-operative Group Limited announced today that it is offering up to NZ$100 million of bonds, with the ability to accept up to NZ$50 million oversubscriptions. The Offer will open on Thursday 18 February 2010 and will close on 3 March 2010.
The unsecured fixed rate senior bonds will have a six year maturity (to 4 March 2016). The minimum investment is $5,000 and multiples of $1,000 thereafter. The interest rate for the bonds will be announced on Wednesday 17 February, the day before the Offer opens.
A Simplified Disclosure Prospectus for the offer has been registered and is available for download at
http://www.fonterra.com/. Applications for bonds will not be accepted until the Offer opens.
Fonterra has mandated ANZ, part of ANZ National Bank Limited; BNZ; and Westpac Institutional Bank, a division of Westpac Banking Corporation, as Joint-Lead Managers for the bond Offer.
On 20 January 2010, Fonterra announced it was considering a bond offer of up to $250 million. The offer size has been scaled back to a maximum of $150 million as Fonterra has been able to cover part of its financing requirements overseas at a very attractive funding cost .
As previously advised, Fonterra intends to use any money raised for general business purposes, including partial replacement of a €300 million Euro Medium Term Note (EMTN) maturing in April 2010.

Fonterra farmer share application period opens December 7

Fonterra’s farmer shareholders will get their first opportunity from next week to invest additional capital in their Co-operative following capital structure changes approved at the annual meeting in mid November.
At the annual meeting, the shareholder vote was overwhelmingly in favour of raising the maximum level of share ownership to 120 per cent of farmers’ current or expected production for the season. Farmers are already required to own Fonterra shares in proportion to their milk production (with one share required for each kilogram of milksolids produced per season) and the change means all farmers can now hold up to 20 per cent additional “dry” shares not covered by their production. All shares will be eligible for dividend payments based on Fonterra’s profitability, providing more of a financial incentive for farmers to own dry shares.

Fonterra Annual Meeting Voting Results

Fonterra shareholders today voted overwhelmingly in favour of the first two steps of the Co-operative’s new capital structure at the Annual Meeting in Ashburton.

Shareholders passed two special resolutions in support of the first two capital structure steps, both of which required a 75% shareholder vote under the Co-operative’s constitution. Resolution 1 – Strengthening the Share Structure, received an 89% vote. Resolution 2 – Restricted Share Value also received an 89% vote.