Gear changes should thwart take-over

Press, Volume CXVI, Issue 34089, 28 February 1976, Page 19

Gear changes should thwart take-over

(New Zealand Press Association) WELLINGTON. Improved profitability prospects for 1976 and a changed company structure should thwart any unwanted take-over bid for the Gear .Meat Company, Ltd. said the chairman (.Mr G. C. Kent) at the annual meeting.

He denied, in response tol a . shareholder's query, that there had been a merger-ap-proach by R. and W. Hel-. iaby, Ltd, the meat exporter, and retail butcher. Gear and Hellaby are considering a joint-venture mutton and lamb-processing plant at Taumarunui. Under further questioning from the shareholder — who later in the meeting voted against a motion to increase directors' fees — Mr Kent: said that when the restruc-i turing of Gear was under- ; taken last year, the directors had at the back of their minds the need to have ihej

‘means to stave off any un-' ‘ wanted take-over offer Three separate subsidiaries 11 had been created to handle > m e a t-processing, inter- ; national-trading, and New’ ' Zealand retail-trading. ’ “This new structure will ■ give each of the main sec-: Ctors of our activity a cor-: porate identity, it will allow specialisation and also induce a little competitive: j* interest which we hope will . make for good results,” Mr • Kent said. I The general manager and: a board member, Mr L. A. ■ Cameron, said that it would! also overcome the domina--|tion of thinking that hy-giene-expenditure had come Ito have on the company. Mr Kent repeated the en-i thusiasm he expressed in his

LIIUMCLOIII UU UA|JIC33UU 111 report on the 1975 trading (year, released earlier 'his 'month, for the switch front a consignment to a con-1 tractual basis for the marketing of the companv’s lamb and mutton in Britain. The company had been

(wedded to the consignment' basis, which had been through Towers and Com- , pany, Ltd, London, for .nauyi .years and which was essen-■ itially a gamble, he said. : Losses had been sustained..! and Gear had been overdue!! for a change in this methodj of sale. The contractual! basis through one of Britain's unnamed food dis-' tributors, had worked out i I very well, he said. i Mr Kent, expected to see a ( I fairly strong advance in., profitability from the New 1 ' Zealand retail meat trade side of the company’s activi- ; ■ ties (which last year pro- •

■ vided one third of the overall record profit of $504,555). . The company did not | • make a profit on its Petone meat-processing business in 1975, but in his annual report Mr Kent expressed the: belief that there would be al (return to profitability irk 1976. On the possible joint-ven-ture processing-plant at ■Taumarunui, Mr Cameron said that Hellaby needed Gear in the King Country lor its livestock and "knowl.how." If the mutton and lamb in-’ lldustry on the west coast of I the North Island was to remain viable, there had to be : intense rationalisation because of static livestock! i number, he said. c

r ' Several shareholders 1 present voted against a mo- a tion to increase directors' a I fees from a total of $BOOO ’to a total of $15,000. Therejt are seven directors, whose v .fees had not been increased s I for four years. I , Mr Kent told the meeting p he was not happy in theic position of advocate for a c pay rise for himself, but v Gear directors’ work during g the last few years had become much more complex. ’ land time consuming. 1 The fees-increase was ap- s proved by a show of hands, v