Meat merger rejected

Alliance Group shareholders play the waiting game as auditors tally their votes at yesterday's...
Alliance Group shareholders play the waiting game as auditors tally their votes at yesterday's special meeting of shareholders at the Invercargill Workingmen's Club. Photo by Matt Maley.
The silent majority ruled at yesterday's special meeting of the Alliance Group meat co-operative, as shareholders voted overwhelmingly to reject resolutions that would have forced a merger with Silver Fern Farms.

More than 400 farmers attended the meeting and heavily rejected resolutions proposed by the Meat Industry Action Group (MIAG) to force Alliance and Silver Fern Farms to begin negotiations that would ultimately create a single farmer-owned co-operative.

The resolutions also created a constitutional committee with the chairman elected by the group and given power over committee members including the right to exclude them from meetings or to stand for re-election.

It was this point which proved a decisive factor in the Alliance Group board's decision to recommend voting against the resolutions.

In a statement the board said the resolutions conferred unacceptable power on the chairman and would serve to undermine and circumvent the board's responsibilities and fiduciary duties to the company and its shareholders.

Group supporters criticised this as a mischaracterisation, with executive committee member Keith Milne assuring shareholders there were no secret agendas and farmers would have control throughout the process.

Alliance Group chairman Owen Poole frequently referred to past attempts or proposals to combine the resources of both companies, in 2006 and 2007, both of which failed because they were not financially sound, he said.

Mr Milne asked if farmers had learnt anything from these two failures and said the industry was collapsing under the current climate, with the loss of 25% of stock in the last year.

He said it was time to rise above the tribal-type mentality and look at the bigger picture, otherwise farmers would be always living off the scraps of someone else's meal.

The resolutions were then put to the floor for comment, with over an hour of exchanges that were at times emotional and vitriolic, and included accusations of dictatorships, soliciting of votes and a hatred between the two companies.

The number of responses in favour of the group's proposal indicated potential for a competitive vote, but this proved to be unfounded.

Two resolutions encompassing 11 remits were heavily defended, with 92.4% and 86.3% of votes against the remits.

Many farmers said they wanted change but the changes suggested by group were not acceptable.

Mr Poole said he was pleased the result was comprehensive.

He said the past several months had been frustrating and the decision by shareholders finally put the issue to rest and confirmed feedback from recent meetings with shareholders in respect to a merger with Silver Fern Farms.

Mr Poole said there was now an opportunity within the industry for constructive dialogue towards forming a common view for a better future.

Mr Milne was still able to smile after the meeting.

"We're obviously disappointed it didn't receive more support, but we accept the outcome. I do think there was some pretty good will out there for it. As someone pointed out, getting an attendance like this shows people are passionate about their company and industry as well," he said.

Mr Milne said a similar meeting with Silver Fern Farms, scheduled for October 8, would no longer go ahead due to the outcome of the vote, and when questioned about the future, he said group members would now take a breather for a little while.

 

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