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Silver Fern Farms: Farmers Will Decide

Fuseworks Media
Fuseworks Media

30 June 2008 - The chairperson of the New Zealand Cooperatives Association, Peter Macdougall stated he is concerned about the effect on farmer income if the half of the meat processing and marketing cooperative Silver Fern Farms, formerly PPCS, is sold to PGG Wrightson.

Peter Macdougall was commenting on the white paper "The New Zealand Meat Industry: Creation of the Integrated Supply Chain" put out by Silver Fern Farms and PGG Wrightson outlining the reasoning behind their recent heads of agreement.

"This is a decision the members of the cooperative need to make. It comes down to how they believe they'll be getting the best dollar for their animals, and to what extent they want to retain control of their cooperative business."

"The same dollar can't go in two directions," he said. "Fonterra's farmer members have made it clear they don't want to lose control of their cooperative and that the milk supply price is important to them, so I'm sure Silver Fern Farm members will let us know what they want to do.

"I'm also sure that farmer members will be interested to know how the cooperative can retain its cooperative status with PGG Wrightson holding half of the voting shares. Although PGG Wrightson will be coming on board as a transacting shareholder, the Cooperative Companies Act 1996 only allows for 40% of investor shares in a cooperative.

"In the end, farmers will decide whether they want to retain total control of their cooperative business or are happy to work with PGG Wrightson. Whichever way they decide to go, I expect their decision will be better for farmers than what we have at present," said Peter Macdougall.

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