Haigh’s of Washdyke sold to Wattie Canneries

Press, Volume CXII, Issue 32977, 25 July 1972, Page 2

Haigh’s of Washdyke sold to Wattie Canneries

(New Zealand Press Assppiation)

TIMARU, July 24.

The assets of D. J. Haigh and Company, Ltd, the Washdyke frozen food processing and marketing subsidiary of Daigety New Zealand, Ltd, have been sold to J. Wattie Canneries, Ltd-

The chairman of Dalgetys (Mr L. A. Sisam) said today that the Wattie group would run the Washdyke plant, from August 1.

It was emphasised in statements that the change in ownership of the buildings, plant, and stock was not a “take-over” in the accepted meaning of the term. The deputy general manager of Dalgety’s (Mr E. Millar) told a meeting of South Canterbury growers this morning, and also said afterwards: “The simple fact is that soun.fi business reasons caused us to put Haigh’s assets on the market and they have been bought by Wattie’s. Other options would have been a closedown, or sale to an overseas buyer.” CONTRACT PLANS The newly-appointed managing director of Wattie Industries, Ltd (Mr G. J. Wattie) said that contracts entered into for the 1972-73 season would be honoured, and, as far as it could be seen, production at Washdyke would continue along the same lines as in the past.

The processing of some lines, such as corn, might cease, but others might be introduced. “We are a little unsure of the future at this early stage, but Washdyke will now come into our thinking, and we hope to rationalise its production in relation to our other factories,” Mr Wattie said.

It was certainly not his group’s intention to close the Washdyke factory. “The processing plant will be kept in operation and the staff required will be engaged from the D. 3. Haigh employees; wherever possible.”

Mr Wattie said his group did not set out to buy the assets of Haigh’s—they were offered to the group which, after very careful consideration, decided to buy.

“We certainly had our doubts, and the prospect was fully debated before a decision was taken,” he said. “However, we are quite satisfied we made the right decision, and I am sure that within a year or two it will all prove very successful to all those concerned.”

The present general manager of D. J. Haigh and Company, Ltd, (Mr B. F. Davidson) will be Timaru branch manager of Wattie’s from August 1, STAFF EMPLOYMENT Mr Millar said that virtually all the permanent factory staff at Washdyke would be offered re-employment with Wattie’s, and would not lose a day’s pay as a result of the change.

Of the 24 members of the office and administration staff at Washdyke, 15 (seven of them men) would not be offered re-employment by either Dalgety’s or Wattie’s, but some of them had al-

ready indicated they had obtained alternative work. The office staff who were losing their jobs would remain on Haigh’s payroll until the end of August when they would receive their accrued holiday pay and a redundancy payment based on their years of service.

COST PROBLEMS Mr Sisam, said in Wellington today that the decision to put the Haigh’s plant on the market was made after several months of careful study of its future prospects ip the highly competitive national frozen foods industry.

“Haigh’s have been successful in establishing a reputation for quality products, but this could not overcome the high cost of distribution, especially to the major consumer markets in the north,” Mr Sisam said. Haigh’s had put considerable effort into export marketing and had achieved encouraging results. But export sales were made on a marginal profit, and. in an atmosphere of increasing shipping costs and market uncertainty in some areas, these could not offset the difficulties arising from in-

sufficient profitability in the domestic market.

“Taking all these considerations into account, we have decided it is not in the interests of shareholders, growers or staff to continue to operate. an enterprise when its prospects of satisfactory profitability appear doubtful," said Mr Sisam. STRONG BASE “In the long-term interests of New Zealand, it is imperative that the frozen food export trade should be built on the basis of a strong domestic market to carry marginally priced export sales.” The Wattie-General Foods organisation was in a position to achieve this type of marketing strength. “As the Daigety export development section has established the Haigh label in certain overseas markets, the Wattie organisation intends marketing through Daigety to ensure continuity of Haigh’s brand in these areas.”

GROWERS PROTEST The chairman of the Vegetable and Produce Growers’ Federation (Mr W. C. Wills) said that the acquisition of Haigh and Company by Wattie’s had created a monopoly and eliminated competition from a producer's point of view. It was imperative that the Government act immediately to formulate legislation to introduce a negotiation and arbitration procedure to provide the producer with bargaining power. “The federation only recently urged the Government to appoint a commission to examine restrictive practices and monopolistic tendencies in so far as they affect this industry,” Mr Wijls said.