Think holding MSE's is a good thing...

An example below shows what you could be losing by holding on to MSE's that your don't need.

Example...

No. of  MSE's     Price     Total Interest Rate Opportunity cost Saving for 5 years Price MSE's would now need to be  
100,000 $20 $2,000,000 4% $80,000 $400,000 $24.00              

By investing the money from selling 100,000 MSE's at $20 could be earning you $80,000 per year. Each year that passes means the MSE price needs to increase to cover the interest lost, and in 5 years you would need to secure a price of $24.00.

 

Should I Lease out my MSE's this season?

 

Is this is for you....

Pros - having additional MSE's will give you the opportunity to create extra income.

Cons - leasing or selling MSE's if your own milk production increases may result in a MSE shortfall.

You need to be able to estimate your milk solid production accurately (so leave the decision as late as possible). Also you may consider retaining a percentage of MSE's as a contingency.

It is more common to lease MSE's and the price paid can then be determined between the parties. For selling, take account the Fonterra share price compared with the Tatua share price, the likely full payout from Tatua milk that it will attract and the risk factor of investing with Tatua

 

What other farmers have to say

Having facilitated this service for several farmers they have made the following comments back to us

Comments to follow..

 

Examples of transfer and lease agreements

Please click on the link to the transfer form. For an example of a lease agreement.

Please note that the lease agreement is provided as a guide only and shareholders are encouraged to take independent advice on matters specfic to their circumstances.

It is important to note shareholders can buy, sell or lease MSE's to each other at any time; however all 'transactions' must be approved by the Board.

To register your interest...

Simply complete this form, and CooperAitken will endeavour to find a trading partner for you.

If you would like to discuss this further with CooperAitken please contact Peter Hexter 07 889 7153 or Maree Anderton on 07 889 8817.

 

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