Tuesday, 25 October 2016 18:25

LIC plays safe on new business split

Written by 
LIC chairman Murray King. LIC chairman Murray King.

LIC has bowed to shareholder pressure by dropping its plan to transfer its herd testing and Minda businesses to a subsidiary.

The co-op will split its business into two on December 1: LIC will handle its core business while LIC Agritech will seek external capital to grow and boost shareholder returns.

LIC shareholders had expressed reservations about transferring herd testing and Minda to a company that could one day be publicly listed.

LIC chairman Murray King told its annual meeting last week that the process on the separation “has given us the opportunity to hear what you value about LIC”.

“We’ve heard your concerns about Minda and herd testing, and can confirm that after the [business] separation both will remain with the cooperative. Minda will be owned by the co-op but operated by the agritech company.”

He said forming an agritech company allows LIC to pursue opportunities for growth, with the potential to attract external investment and generate returns for investors.

“External funding will not flow into our core genetics business, but the separation creates an opportunity to attract external investors and potentially commercial partners to the agritech business, with shareholder approval.”

LIC has also listened to shareholders and dropped its goal to be a $1 billion revenue co-op.

“We are yet to develop a new goal or statement of purpose, and will work with the shareholder council on this,” Murray told shareholders.

A motion to increase the allowance of LIC directors was passed with a narrow margin at the annual meeting. LIC told the stock exchange that 405 shareholders cast 361,566 votes in favour, while 459 shareholders cast 292,982 against. – Sudesh Kissun

More like this

Climate-friendly cows closer

Dairy farmers are one step closer to breeding cow with lower methane emissions, offering an innovative way to reduce the nation's agricultural carbon footprint without compromising farm productivity.

Featured

Contract milkers hit hard by drought crisis

Many contract milkers in badly drought affected regions around the country are coming under severe financial stress and farm owners are being urged to help them through a bad patch until the start of the new season.

Controls lifted at poultry farm

Movement controls have been lifted from Mainland Poultry’s Hillgrove Farm in Otago, after the successful eradication of H7N6 strain of high pathogenic avian influenza (HPAI).

National

Lame stories from a country vet

Everyone from experienced veterinarians and young professionals to the Wormwise programme and outstanding clinics have been recognised in this year’s…

Machinery & Products

Amazone extends hoe range

With many European manufacturers releasing mechanical weeding systems to counter the backlash around the use and possible banning of agrochemicals,…

Gong for NH dealers

New Holland dealers from around Australia and New Zealand came together last month for the Dealer of the Year Awards,…

A true Kiwi ingenuity

The King Cobra raingun continues to have a huge following in the New Zealand market and is also exported to…

» Latest Print Issues Online

Milking It

Greenpeace a charity?

OPINION: Should Greenpeace be stripped of their charitable status? Farmers say yes.

Synlait's back

OPINION: After years of financial turmoil, Canterbury milk processor Synlait is now back in business.

» Connect with Dairy News

» eNewsletter

Subscribe to our weekly newsletter