This does not look like an inspired decision.
NZX has bought the paper stable of rural publisher CountryWide.
We find it a strange investment in troubled times.
Mr Weldon says the deal is important as the primary sector underpins the New Zealand economy and the team at Country-Wide deeply understands its farmer readership.
“Farming is the biggest single industry in New Zealand, and farmers are innovative businesspeople who rely on timely and robust data and information to make sound decisions.”
The publisher produces 78 publications a year under seven mastheads and had a turnover of more than $7 million in 2008.
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4 comments:
I think it's a very good idea. Farmers have money (sometimes). But they don't generally trust listed investments - haven't since 1987 - and the whole connotation of shifty city slickers doesn't sit well with them. They'd rather invest in property. But this gives the NZX a platform to preach diversification to them. It also gives them a trusted platform to educate farmers on the sorts of products it's developing via the farm data businesses it's purchased in the past three years. I think it's a long term play, and not likely to be a mega money maker, but it does show NZX solidifying its support of the rural sector.
Agreed on the shift, NZX appear more intent on building an empire than on providing the best stock exchange they can, if they had money to burn doing a options market for milk products/meat/wool would have far more potential upside for farmers than this purchase ever will ( leaving aside the possibility of it being used to "Push" a listing of Fontera, but that is the act of a desperate stock exchange & the NZX would never stoop that low would it ).
To the above anon, thats a pretty cycnical view, and comments lacking any information.
To trade milk futures, or any derivative products for that matter, you need a clearing house.
If you had done a tiny bit of research you can see that NZX has been trying to build a clearing house for the past 18 months (its in all their news releases).
NZX makes most of its revenue of selling market data, listing and trading fees make less than 30%.
The rural sector for agricultural data is pretty fragmented over the whole australasia, and from past news releases NZX has slowly being buying up agri-data businesses, pretty easy to see what there long term goal is.
What was it they said in "In Search of Excellence" - stick to YOUR knitting and you will always do well.
I have to wonder what the NZ Stock Exchange's knitting it!
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