Monopolies Commission Favoured By Mr Kirk

Press, Volume CIX, Issue 31921, 24 February 1969, Page 22

Monopolies Commission Favoured By Mr Kirk

The Leader of the Opposition (Mr Kirk) said on Saturday that the Labour Party favoured some form of monopolies commission to scrutinise all take-over proposals and the activities of monopolies, and that the Government’s announcement on the Waitaki-C.F.M. bid was a “do nothing” decision.

The announcement by the Minister of Agriculture (Mr Taiboys) that the Government will not

interfere, “while in character for the Government, must be deeply disturbing to producers and a great many of C.F.M.’s employees and’ shareholders,” said Mr! Kirk. “The decision is apparently a reversal of Government’s attitude for it is rot so long since Mr Muldoon was telling the country that the Government regarded the take-over bid as undesirable. "One wonders what pressures were at work behind the scenes to compel the National Government to take no action in a matter which the Minister of Finance said the Government regarded as un-: desirable,’’ Mr Kirk said. “DISTURBING” “The decision to do nothing; is deeply disturbing because! it may well be regarded by the overseas-owned freezing companies as opportunity to make some take-over moves of their own and this would be most unsatisfactory,” he said.

The failure of the Government to act underlined the “absolute necessity of proper statutory provisions and machinery to scrutinise and deal with take-over bids and monopolies. “Because some take-overs are primarily speculative ventures in which the shareholders are virtually bought off with their own reserves and do nothing to add to productivity or efficiency, the Labour Party, as a matter of policy, is committed to the establishment of a Take-over and Monopolies Foreign investment Authority.” The authority would have the duty of scrutinising and examining all take-over proposals and activities of monopolies and would be required to base its decisions on the broad principle of national interest. “Provision would be made for appeals against the decisions of the five-member authority to the administrative division of the Supreme Court. “Such machinery will enable take-over bids such as that menacing C.F.M. at the present time to be considered on its merits and resolved in the light of the national interest instead of V a matter of political expediency,” he said.

C.F.M. CHAIRMAN The Government’s decision carried no implication that the Government or the Meat Board favoured the bid,

• according to a statement issued by the chairman of ! directors of C.F.M. (Mr L. D. ■ Cotterill), the Press Associa- ; tion reports from Wellington.

The decision means “they agree it should be left to the shareholders of C.F.M. to decide for themselves whether or not to accept the take-over offer, a view with which the board of C.F.M. concurs entirely,” said Mr Cotterill. ' “At the general meeting of C.F.M., at which more than 200 shareholders were present

and at which over 1000 shareholders holding over 60 per cent of the total share capital of the company were represented, all the proposals of the board were accepted unanimously and of the number

of shareholders who spoke, only one did not fully support the directors’ opposition to the bid.

“Nothing has happened since the general meeting and particularly nothing transpired during the meetings of the two boards under the chairmanship of Mr E. D. Wilkinson, which showed advantages to both companies if they were to be merged but it was agreed to investigate further the question of co-operation in overseas marketing. : In Oamaru, the chairman of: the Waitaki company (Mr D. Malcolm) said: “Naturally we are satisfied with the Government’s point of view that there should be j no interference in Waitaki’si bid for C.F.M. “The Government approval, in effect, answers all criticism, much of it ill-informed, that has appeared in the press.”