Plant ownership key to meat restructuring

Press, 28 July 1989, Page 19

Plant ownership key to meat restructuring

The rationalisation of ownership of meat processing plants would be the first step in restructuring the meat industry, says the chief executive of the Alliance Group, Mr Sandy Murdoch. He told a public forum at Telford that there was a prospect of ownership rationalisation if the two major corporates in the industry had a genuine wish to leave the meat sector. (Goodman Fielder Wattie and Fletcher Challenge are major shareholders of Waitaki International). Mr Murdoch said the two corporates considered farmers to be the natural owners of the meat industry, but their efforts were being directed towards ensuring they received a premium on the real economic value of their facilities.

“There is nothing philanthropic about their position.”

Mr Murdoch said ownership rationalisation

would enable the excess capacity issues to be addressed — internally if necessary. This had potential for a dominant producer stake to emerge and allow the role of the Meat Producers Board to change.

The board would be able to relinquish its involvement in non-com-mercial aspects of marketing and to unwind its commercial stake. The board could ensure that commercial accountability flowed through the companies back to supplier shareholders. The producer stake in the industry must be through co-operatives rather than the Meat Board/Freesia link. Mr Murdoch said the democratic rights of farmers as stakeholders would be better protected through a directorate in producer companies rather than the Meat Board’s existing structure.