Vote ends 'damaging' objection to deal

A reaffirmation of support from Silver Fern Farms shareholders for a joint venture with Shanghai Maling means the company can "get on" with the transaction, chairman Rob Hewett says.

About 150 people attended a special meeting in Dunedin yesterday, following a request from a group of shareholders to revisit the deal.

Requisitioners John Shrimpton and Blair Gallagher, who sought to stop the transaction, believed it had not properly been approved.

A strong majority of 80.4% of votes cast were in favour of the special resolution, and followed the result of the October 2015 vote, where 82% of votes cast supported the transaction.

In the most recent vote, 2610 shareholders voted, representing 62% of eligible shareholders.

The board had said it intended to complete the transaction, irrespective of the outcome of the non-binding resolution.

Following the vote announcement, Mr Hewett said the board was grateful, humbled and "on track" to complete the deal.

It had been distracting to the company and it welcomed having "put it to bed".

"We can now get on with the task at hand which is consummating this transaction and running this business in the meantime."

All conditions had now been achieved with the exception of  Overseas Investment Office (OIO) approval and SFF expected to get that, he said.

SFF has been awaiting an announcement from the OIO since last October’s vote.

In late June, it announced it was finalising an extension to the June 30 deadline for official approval to be granted, saying it needed to allow more time to provide the required information and to allow  the OIO and Government ministers  sufficient time to review the information.

Speaking at a media conference after the vote, chief executive Dean Hamilton said the OIO had confirmed it now had the information it required and it was in the process of making  recommendations to ministers.

SFF was comfortable that  would be completed by the extended deadline of September 30 and  the transaction could be completed by January 4 next year.

"The clear message from the voters is to get on with it and realise this opportunity ahead of us," he said.

Mr Hewett said the board "strongly disagreed" with Mr Shrimpton and Mr Gallagher’s  opposition to the deal.

Their objections  had "undoubtedly been damaging, distracting and costly" to the company.

Asked by a shareholder what that cost was, Mr Hewett said he did not have exact figures but it would be "probably closer" to $1 million than $500,000.

It was not just the cost —  the time,  effort and disruption  involved was "reasonably significant".

"They have caused significant disruption and their actions have been damaging to the company. Their allegations have proven to be entirely unfounded."

Independent reviews by both the Financial Markets Authority and the Registrar of Companies had found no issue with the information provided to shareholders in October last year, or the actions of the directors, he said. 

"I’m not sure how many more hoops we’ve got to jump through."

The board remained unanimously of the opinion the transaction was in the best interests of the company and  shareholders.

No other meat exporter to China would have the access that SFF would and it was a "very, very privileged position".

He said nobody was denying that it was a big transaction but, by law, it was not a major transaction.

More than 50% of the company had not been sold, he said.

The 7000 jobs at SFF were more often than not in rural areas where there were not many employment alternatives.

Those jobs were staying in New Zealand, as were the factories,  livestock and farmers. Shanghai Maling was  investing in New Zealand, Mr Hewett said.

The meat would be cut in New Zealand to add value to it to create, with Shanghai Maling, the premier red meat brand in China.

"This is a great opportunity for New Zealand," he said.

Shanghai Maling was committed to the deal,  as was SFF.

It was a genuine partnership and, while there would be tensions along the way, as in any relationship, both were committed to making it work, he said.