Overwhelming 'yes' for sale of Westland

Subject to shareholder approval in early July. Photo: Westland Milk Products
Photo: Westland Milk Products
It was a done deal - the vote to sell Westland Milk Products to Chinese dairy giant Yili was sealed well before the ballot in Greymouth yesterday.

The "yes" vote will save Coast farmers from crippling debt, but it is also the death knell of their 82-year-old once proud co-operative which started on the paddocks from Kokatahi to Hari Hari on the West Coast.

Just a smattering of the 429 shareholders showed up for the vote at the Regent Theatre in Hokitika, and were deflated to hear that 82% had already voted by postal ballot, overwhelmingly in favour.

They returned at 1pm after the ballots had been counted, and it was official.

From August 1, the co-operative would no longer belong to New Zealand, let alone Westland.

In the end, 93.79% voted in favour.

Westland Milk chairman Pete Morrison said in a prepared statement that shareholders had shown strong support for the proposal.

"This proposed transaction will secure a competitive milk payout for at least 10 seasons for all of our existing shareholders and ensures that all of our existing shareholders' milk would be picked up for 10 years.

"The offer of $3.41 per share is significantly higher than the independent adviser's valuation range ($0.88 to $1.38 per share) and the milk supply commitment ensures a minimum price for 10 seasons of at least the Fonterra farm-gate milk price."

Mr Morrison, who lives in Canterbury, said it was an important milestone in Westland's history.

"While Westland will cease to be a co-operative, the board believes the proposed transaction represents the best available outcome for shareholders."

Yili provided a "very strong route to market" as one of the world's leading dairy producers, he said.

The sale remains conditional, including obtaining consent from the Overseas Investment Office and approval from the High Court, with a final court hearing scheduled for July 18.

In a last-gasp protest outside the theatre, a few gumboot-wearing farmers held placards, and some heckled the board of directors as they arrived for the meeting.

But once inside, "95% were in favour" of the Chinese deal, due to a landslide of postal ballot support.

With only 18% of the vote left to be decided at yesterday's meeting "it wasn't going to change anything", one farmer said, leaving the shareholders who turned up visibly demoralised.

"A lot of the questions evaporated after that."

The "no" farmer said the deal had been presented as a fait accompli by the board.

"I'm dead set against it. I think they've sold it out. I don't think the offer is good enough and then 10 years out ... the suppliers from Karamea to Haast [are left with] no guarantees.

"I can't get over the fact ... they only spent $583million on a factory which has everything, and a marketing arm." - Greymouth Star

 

Comments

It had to happen as the company was broke /////// but it should not have been / in time milk pay outs to farmers cauld be anything that's the problem