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Monday, 28 September 2015 16:30

MIE urges SFF shareholder scrutiny of China deal

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Meat Industry Excellence (MIE) says Silver Fern Farms shareholders need to carefully scrutinise the capital-raising proposal put forward by the cooperative’s board.

MIE chair, Peter McDonald, says despite what the company is saying, it is questionable that this proposal is the best or only option available to the company or to farmers.

MIE is encouraging farmers to become engaged with understanding and debating the proposal, and with asking questions of the SFF Board.

McDonald adds, “Why has a potential 50% partner been granted executive powers at board level which doesn’t seem to be reflective of their proposed share?

“The good is often the enemy of the better,” … “Of course there are some positive elements to the proposal, but there seems to be very little understanding of the risks or costs to farmer shareholders and the industry.”

He says the biggest question of all in his mind is why just one option was being put forward by the board.

“Shareholders should be trusted to view and vote on more than one option,” he says.

“Shareholders are soon also being asked to vote on a resolution from SFF shareholders themselves asking the board to more closely examine the benefits of a combined cooperative model, arising from MIE’s industry analysis.

“It’s quite extraordinary that the board is pursuing, almost out of left field, a proposal that opens the door to a foreign takeover instead.”

MIE was encouraging farmers to ask questions of the SFF board, and to carefully evaluate the proposal.

“In the meantime, we are encouraging Silver Fern Farms shareholders to become very engaged with this process,” he says. “Attend meetings, and pass on information to other shareholders.”

Plenty of good commentary and information was emerging, he says. In the end, the decision was in the hands of SFF shareholders, and it was a decision that could significantly influence the fate of the meat export industry.

“The sweeteners being offered to shareholders in the deal ought not to be the deciding factor,” says McDonald.

“If anything, farmers should be asking why the deal requires a financial sweetener to shareholders if it makes sense in the long run.”

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