Anzco chairman criticises PPCS revelations

One of the parties courted in the failed meat company merger has accused PPCS of trying to make Alliance Group chairman and merger instigator Owen Poole look unprofessional by releasing details of the merger talks.

Anzco chairman Graeme Harrison said in an interview that PPCS was playing politics and he questioned whether the Dunedin meat co-operative ever intended to engage in the merger process.

He was reacting to a letter released by PPCS on April 21, which set out its reasons for not signing a co-operation agreement required by Alliance and a time-line of the negotiations.

Mr Harrison said releasing such details breached confidentiality and was not accepted business practice.


PPCS did not sign the co-operation agreement required to advance the mega merger, citing concerns about the process and that companies, such as Anzco, wanted to retain their beef business, which PPCS feared would undermine savings from a merger.

 

 

Mr Harrison added to the perception that PPCS was being isolated by other meat companies as fallout from the failed merger, which reveals mistrust and ill-feeling.

"I have absolute full confidence in entering the process with Owen Poole as chairman of Alliance. I can't say that about the other co-op.''

Mr Harrison stressed he was not insulting PPCS, which he has previously worked with, rather he was reacting to the company's actions on this issue.

Mr Harrison described the beef concerns as a "smokescreen'', adding that he believed PPCS did not want to pursue a merger.

Anzco was prepared to engage in the process in good faith and consider selling assets to the new entity, but Mr Harrison said he would not enter into a similar process again.

"I will not waste our time or upset employees of the company or shareholders by having another public debate.''

Mr Poole had tried to fast-track the process by merging five companies into one by getting parties involved and then seeing what eventuated.

Ultimately, that required "a meeting of minds'' between the two co-operatives, PPCS and Alliance.

Mr Poole could have been seen as "dogmatic'' during the merger process, but Mr Harrison said he had acted professionally throughout.

Meanwhile, PGG Wrightson and Meat and Wool New Zealand urged farmers to remain confident, saying the formation of Fonterra was similarly interrupted by blood-letting at a similar stage in the dairy industry merger.

 

"We had plenty of stoushes, blood-letting and handbag swinging, and often it came down to personalities,'' said current PGG Wrightson chairman and former Fonterra chief executive Craig Norgate.

Mr Norgate said PGG Wrightson would initiate discussions between meat companies if asked.
But he believed the parties needed time to catch their breath, take stock, and determine what the issues were.

"We will act behind the scenes, but they need to all sit in a room and talk, not play games in public.''

Meat and Wool chairman Mike Petersen said while the Alliance concept was dead, he was concerned at the loss of goodwill.

Meat Industry Task Force chairman of the board Sir John Anderson was in Dunedin last week to broker a deal, but the meeting was cancelled due to animosity between the sides.

Mr Petersen said the future of the task force would be reviewed in the coming weeks, as any consolidation would now be driven by commercial decisions.
The task force was established earlier this year to find ``options that will provide a better future for our farmers and industry''.

"We can do all we can to try and put parties together and find a direction for the industry to focus, but in the end it is up to commercial companies to buy into that,'' Mr Petersen said.
Mr Petersen was still optimistic the meat industry would be restructured.

"We'll get there eventually, but how much value will be lost along the way?''

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