It would be a staged process, with like-companies merging for commercial reasons to eventually create a large entity, rather than the Alliance model in which it would have merged with PPCS and become the vehicle to acquire other companies.
There is now little likelihood Alliance and PPCS will merge.
In a recent letter to shareholders by Alliance chairman Owen Poole, he said that while Alliance would focus on improving returns through a new model, a merger of the two meat co-operatives would not benefit Alliance shareholders.
"Last year, the board determined that a merger of the two co-operatives would not provide benefits to Alliance Group shareholders.
This view remains unchanged," he said.
PPCS complained the Alliance Group's concept was too prescriptive, the timeframe too tight and other companies were not initially involved in developing the proposal.
Meat and Wool New Zealand chairman Mike Petersen said while the Alliance model was the ultimate goal, it could take longer to get there as companies worked through their options.
"There is a lot of ongoing discussion between the different parties trying to work out the best way to get to the end game," he said.
"It is going to be a staged approach and that is appropriate."
He believed the first signs of industry restructuring could come within 12 months.
All companies involved in the mega merger have indicated since talks collapsed that their focus was on their core business, but this indicates plenty is happening behind the scenes.
A staged restructuring would avoid the directive by Affco and Anzco that the two co-operatives sort out their differences before they would consider another industry-wide approach to restructuring.
Mr Poole said in his letter to shareholders that Alliance remained committed to improving the structure and performance of the industry.
"We believe that the industry needs to create increased returns through a new model rather than relying on market and exchange rate cycles."
But the changes it was considering were unlikely to involve PPCS.
He was encouraged, however, by the attitude of the other companies involved and the measure of goodwill being developed.
"During discussions, a number of other potential opportunities have been identified.
While not providing the benefits anticipated by the concept, they will now be further evaluated."
Mr Poole said on reflection, PPCS had no interest in his company's restructuring plans.
Meat Industry Action Group chairman Keith Milne said his group remained optimistic because farmers were demanding change.
"Farmers recognise they can control the outcome and are stepping up and doing that in large numbers."
Mr Milne said support among sheep and beef farmers for change was high, and meat company directors would be forced to acknowledge that.
