Alliance Group returns to profit after two years with $93m turnaround
After two years, Alliance Group has returned to profit.
Shareholder James Anderson from Waikaia in Southland, was outspoken at Alliance's last annual meeting in December about the need to maintain the company as New Zealand's only 100% farmer-owned meat co-operative.
He has now told Rural News that "a group of us" was working on putting a proposal up to the shareholders, which would keep the company in their hands.
Anderson said he could not disclose too much of the proposal, but it involved keeping the PDS alive - the Public Disclosure Statement that defines the company's ability to take a per stock unit deduction to gain capital - along with a lot of cost-cutting.
But he said it was achievable.
"First of all, we've got a profitable company going forward. This year, they should be turning a profit.
"Then we've got to work on shareholder capital going in: to keep it as a co-operative we've got to have that.
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"Then the rationalisation within the company. So, taking a big axe to a lot of costs within the company."
Anderson said a lot of rationalisation could happen without closing more plants (in addition to Smithfield which was closed last year) but the big thing was to try to keep all the plants full.
Farmers needed to support the company with throughput.
Anderson said more details of the counter proposal would come out about the time of the first of the roadshow meetings.
"We are working on something and whether we can achieve it or not, it's going to be interesting."
The Dawn Meats proposal, like Silver Fern Farms with Shanghai Maling, represented money up front for shareholders but Anderson said they "ought to stop and think for five minutes."
"If the shareholders don't think about what they're doing, we're going to lose the only farmer owned co-operative meatworks in New Zealand. And in 10 years' time, we could be regretting it.
"So how do you sell that to young people? I'm not sure. But we're trying."
The roadshow begins in Southland on September 29 and will work its way northwards with up to three meetings a day for about two weeks. A vote on the Dawn Meats proposal will then be conducted at a Special General Meeting in October.
Alliance says chair Mark Wynne and chief executive Willie Wiese will attend the roadshow meetings to provide more details on the proposed deal.
"We encourage all shareholders to attend one of the roadshow meetings," said Wynne.
"This in an important opportunity to hear directly from the company, ask questions and gain a clear understanding of the proposed investment partnership."
Shareholders can also expect to receive a Scheme Booklet and accompanying information in the coming weeks.
Alliance is advising farmers to register for the roadshow meetings to ensure admittance, as some venues have capacity limits.
