30/06/2026
OpenGate Finance | Quarterly Client Update
April – June 2026
Fonterra Mainland Sale – Key Milestone Delivered
A major milestone for Fonterra shareholders and unit holders was reached this quarter with the completion of the Mainland Group divestment to Lactalis.
The transaction was finalised at the end of March, with all regulatory approvals secured, the sale declared unconditional, and Mainland fully separated from Fonterra.
Proceeds from the sale were distributed on 14 April 2026, with the record date set at 9 April to determine entitlement.
Earlier in the year, shareholders overwhelmingly supported the associated capital return, approving a $2.00 per share payout as part of the broader $4.22 billion transaction. The resolution received 98.85% support at the Special Meeting, reflecting strong backing for the strategic shift.
This marks a significant step in Fonterra’s repositioning, sharpening its focus on higher-value dairy ingredients and B2B markets, while returning meaningful capital to investors.
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Dairy Farmers Back DairyNZ in Levy Vote
Dairy farmers voted to retain the DairyNZ levy, with 66% of voters in support — representing 72% of milksolids from those who participated, on a 47% turnout. The result provides a clear mandate for DairyNZ to continue its work programme, with farmers reinforcing a focus on productivity, resilient farm systems, and sustainability. DairyNZ will now move to secure final ministerial approval ahead of the November General Election.
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The window is open in Rural Finance right now — but only if you act on it.
A few key shifts from this week that matter for farmers and agribusiness owners:
1. Rates have stabilised — but don’t expect a big drop
The OCR is sitting at 2.25%, and while pressure has eased, interest costs are still above long-term norms.
Translation: cashflow pressure has peaked, but rates won’t “fix things” on their own.
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2. More capital is entering the market
We’re seeing a clear re-emergence of non-bank lending alongside traditional banks, giving farmers more options around timing, structure, and flexibility.
Translation: it’s no longer just about your main bank — the right structure matters more than ever.
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3. Farm balance sheets are stronger than most people think
Lower debt levels + higher asset values = improved equity positions, and importantly, banks are more willing to lend again.
But there’s a catch:
There can be up to a 2–4% difference in pricing for similar deals depending on how they’re presented.
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So, what does this mean in practice?
We’re in a rare alignment window where:
• balance sheets are strong
• lenders are more open
• capital options are expanding
But outcomes are highly variable.
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Dairy Outlook: Strong Prices… But Margins Under Pressure
Recent insights highlight a key trend in the dairy sector — while milk prices remain strong, farm costs are also staying high.
🔹 Forecast milk price for next season: around $9.50–$10.00/kgMS
🔹 But rising costs (fuel, fertiliser, inputs) are putting pressure on margins
🔹 Global uncertainty is adding further risk to costs and supply
The takeaway
It’s shaping up to be another profitable season — but disciplined cost management and planning will be key.
If you’re reviewing your position or planning ahead, now is a good time to sense-check your structure and funding.
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Proposed merger of Heartland Bank and TSB will create a New Zealand challenger bank of scale with a regional focus
02 June 2026
Heartland Group Holdings Limited (Heartland) (NZX/ASX: HGH) has announced that it has signed a conditional merger implementation agreement (MIA) with Toi Foundation and Toi Foundation Holdings Limited (together, Toi Foundation) to merge Heartland Bank Limited (Heartland Bank) and TSB Bank Limited (TSB).
Under the proposed transaction, Heartland will acquire from Toi Foundation all TSB shares on issue for an aggregate consideration of $620 million. Immediately following the acquisition, Heartland Bank and TSB will merge to create TSB Heartland Bank Limited (TSB Heartland Bank).
The proposed merger will create a New Zealand challenger bank of scale with a regional focus – increasing banking competition and choice for New Zealanders. By bringing together Heartland Bank’s specialist product expertise and TSB’s cost-
effective funding platform and established transactional banking capabilities, TSB Heartland Bank will be a full-service capable bank differentiated by its specialist products, with a lower risk-weighted product portfolio.
Should the proposed merger proceed, substantial scale benefits, value creation and material synergies are expected to be available.
Link attached:
Proposed merger of Heartland Bank and TSB will create a New Zealand challenger bank of scale with a regional focus | Heartland Bank
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Friday 5th June in New Plymouth 🚀
AI isn’t coming… it’s already here — and it’s usable.
Spent the day at the 2026 Great New Zealand AI Roadshow and it delivered. Real NZ case studies, practical tools, and straight-up conversations about what actually works (and what doesn’t).
The big takeaways:
• The quickest wins are saving time on repetitive work
• Small changes = big gains in efficiency
• Better tools = better client outcomes
No hype — just practical ways to get started now.
Next step for us: testing where this fits into our day-to-day and how it can lift the way we support clients.
Always worth getting out of the office, challenging your thinking, and coming back with ideas you can actually use.
Big thanks to Justin Flitter and the team — well worth the day
What are you using AI for in your business right now?
Planning beyond the next 12 months
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Alongside day-to-day work, we’ve also been helping clients think further ahead — reviewing ownership structures, succession conversations, and medium term funding strategies.
These discussions are often prompted by current pressure, but they tend to deliver the greatest long-term value when tackled early and calmly.
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Looking ahead
As we move into the next quarter, the focus remains on:
• Staying ahead of bank expectations
• Maintaining flexibility in funding structures
• Making informed decisions while conditions are still supportive
If you’d like to sanity check your position, talk through upcoming funding decisions, or simply sense check what your bank might be thinking, we’re always happy to have the conversation.
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Nick Bettington
027 836 4198
[email protected]
https://opengatefinance.co.nz
OpenGate Finance
Capital made easy. Best rates. Stress free ag finance.
