Prospects ‘not good’ for Alford take-over

Press, 21 June 1980, Page 2

Prospects ‘not good’ for Alford take-over

The prospects do not look good for a take-over of the Ashburton-based Alford Forest Mills by an Ashburton flour-milling company, according to the latter’s chairman, Mr J. Brand. A meeting was held yesterday in Christchurch with the milling company, Canterbury Roller Flour Mills, Ltd, and another company which is believed to have a substantial interest in Alford Forest Mills, to determine whether an offer would be made for Alford, which is part of the Mosgiel, Ltd, group. Mr Brand said that a preliminary feasibility study had been made, but the pricing structure in the woollen industry gave cause for concern. He would not elaborate on this comment. “There is also a pretty heavy contingency for redundancy,” Mr Brand said. After a “pretty lengthy” meeting, it was decided to

commission a detailed study by an accountancy firm, and to ask Mosgiel. for an extension of its deadline to allow this study to be completed. Companies interested In taking over part or all of Mosgiel’s operations have been asked by the company’s receivers to make their offers by June 24. The receivers have been given till June 30 to decide what will happen to Mosgiel. “It must show as a viable proposition before we can make any move,” Mr Brand said. Alford Forest Mills employs about 180 people. The feasibility study had looked at the possibility of diversifying the mill into textiles.

Mr Brand has said earlier that milling quotas limit the amount of flour that mills can process and diversification into textiles could be an investment for flour mill reserves.