A group of former Farmlands directors have come out publicly
in support of the proposed merger with South Island
co-operative Combined Rural Traders.
Two Farmlands directors, Charlie Pedersen and Hugh Ritchie,
resigned last week, saying they did not believe the proposal
was in the best interest of members of the North Island-based
Yesterday, a statement was issued by six former directors -
John Hathaway (Bay of Plenty), Sam Robinson and Steve
Wyn-Harris (Hawkes Bay), Ross Linklater (Manawatu), Roger
Barton (Wairarapa) and Dennis Munro (Gisborne/Wairoa). They
said they strongly believed it was a sound proposal with good
commercial merits and each would be voting in favour of the
Five of the group were members of the Farmlands board when it
considered a potential merger with CRT six years ago.
At that time, Farmlands' market share of the rural supplies
business was 12% and they believed then it was in the best
interests of shareholders to instead concentrate on the gains
that could be had in the North Island first.
With a change in strategic positioning and an ''excellent''
management team, that market share had grown from 12% to 27%
within five years and sales from $360 million to $773
The landscape had also changed, with further industry
rationalisation and the growth in the size of suppliers.
The group believed the company was ''now positioned very
well'' to consider the proposed merger.
''There is no credible alternative proposal from the people
opposed to this merger other than reject it and we believe it
unwise to turn away from a collective benefit of $38
million,'' they said.