"Our" business?
OPINION: One particular bone the Hound has been gnawing on for years now is how the chattering classes want it both ways when it comes to the success of NZ's dairy industry.
Shareholder Murray Beach has successfully included a complex and detailed proposal to change the cooperative's shareholding rules; farmers will decide its fate at their annual meeting in Waitoa later this month.
Beach is also contesting the co-op's director elections. But his fate already seems sealed.
The ramifications of Beach's plan are profound. So in the meeting notice Fonterra's board has published a damning explanatory note: "The proposal is detailed but contains a number of inconsistencies and unworkable features."
The board says the proposal "would re-introduce redemption risk which was removed by the changes made to the constitution by shareholders as part of Trading Among Farmers".
"The proposal is also inconsistent with the current statutory framework provided for in the Dairy Industry Restructuring Act 2001. The re-introduction of redemption risk would undermine the company's financial strength which would impact [its] strong credit rating and its ability to secure debt funding on favourable terms."
