Wools of New Zealand (WNZ) and Primary Wool Co-operative (PWC) shareholders have overwhelmingly voted in favour of a proposed merger between WNZ and PWC-owned CP Wool (CPW).
The new organisation will combine the trading and operating businesses of WNZ and CPW.
More than 99.7% of WNZ shareholders and 100% of PWC shareholders voted for the merger, which will see both companies become partners in a new entity called Wools of New Zealand LP. Around 50% of the total shareholders from both companies voted.
“Growers have spoken and backed our vision to build one organisation with strength and scale to make a real difference to New Zealand’s struggling wool industry,” says James Parsons, chair of WNZ.
Parsons believes the strong result, validates the decision to consolidate the sector and better link the supply chain from the grower through to the consumer. He claims that by combining operations, the new entity will provide the scale, focus and shared vision to achieve better outcomes for woolgrowers.
“This merger represents the first serious grower-owned consolidation of the industry in many decades. By joining forces, we can deliver on our market vision and ultimately better realise the full potential of wool,” Parsons adds.
Richard Young, chair of CPW, which is 100% owned by PWC, says the result lays the foundations to deliver improved fortunes for the wool sector.
“This single growerowned entity will help drive our shift from wool as a raw commodity to grower-owned and branded consumer wool products. Ultimately, the development of an integrated supply chain aims to improve returns for our growers.”
Young believes the new entity will be able to capture greater value for wool growers through shortened supply chains, while also investing in marketing and sales.
“We now have the ability to chart our own destiny as growers and capture greater value. Farmers need two positive income streams from sheep.
“We must now focus on delivering these better outcomes that we believe this combined strategy will unlock.”
The WNZ and PWC boards expect to complete the transaction by 30th November 2021.
The new entity will be called Wools of New Zealand LP and transact approximately one third of NZ’s wool clip as well as exporting WNZbranded wool and carpet.
“We appreciate and value the support and engagement from shareholders over the past 12 months and look forward to announcing further initiatives in the coming months,” Parsons says.