DAIRYING INTERESTS.

Otago Witness, Issue 3995, 7 October 1930, Page 18

DAIRYING INTERESTS.

A PROPOSED AMALGAMATION.

• HISTORY OF NEGOTIATIONS. w . + i IN YERCARGILL, October 5. Whether the New Zealand Producers’ Co-operative Marketing Association was justified in refusing the terms of amalgamation proposed by Amalgamated Dairies, Btd., at the recent conference in Hamilton was a question that was debated at some length and with some heat at a meeting of shareholders of the Marketing Association on Saturday, Mr G. D. Macl’arlane, of the association’s London office, was present, and in the course of an address he dealt briefly with the proposal put forward at the conference, and the reasons for the association declining to accept them. Mr John Fisher, the Southland director of Amalgamated Dairies, criticised Mr MacFarlane’s ver--610t? a .nd the attitude of the association, declaring that the directors of that organisation had been lacking in courtesy and foresight in their action. Mr MacFarlane stated that the proPr >sa z? brought before the conference by Mr Goodfellow’s organisation had been such that the Marketing Association could not accept them. It would have been necessary for the association to sacrifice its identity and sever its connection with the Co-operative Wholesale Society of England, which had been persistently criticised by Amalgamated Dairies. As a co-operative organisation the association could not combine with Amalgamated Dairies, which had no true cooperative basis.

Mr Fisher said that a considerable amount of correspondence had passed between the Marketing Association and Amalgamated Dairies prior to the conference, but the Marketing Association’s representatives had attended the conference without having given the question much thought or having prepared any concrete proposals which might form the basis of amalgamation. This, Mr Fisher declared, showed scant recognition of their responsibilities on the part of the directors. On the other hand, Amalgamated Dairies had prepared a definite scheme which the speaker believed was quite equitable. The conference had been a very pleasant one, and- it had been hoped that something of benefit to the industry as a whole would eventuate. It had been very disappointing. therefore, when a letter was received by Amalgamated Dairies w-ithin a few days completely refusing to accept the proposals, or any part of them, and criticising the constitution of Amalgamated Dairies. A great merging of interests had taken place amongst the buying” organisations at Home, and it was essential that the marketing organisations should take similar action if the industry was to receive justice. The business handled by the Marketing Association and Amalgamated Dairies ran into millions, and it showed a great lack of foresight and business enterprise on the part of the directors of the Marketing Association to turn down the overtures of Amalgamated Dairies after a superficial examination. Criticism had been levelled at Amalgamated Dairies on the grounds that it was built up on a proprietary basis, but this was not correct, and the Marketing Association was actually more of a proprietary concern than Amalgamated Dairies. Mr Fisher said fie was firmly convinced that the greatest good would come out of the present meeting if a motion was carried requesting Mr MacFarlane to recommend his directors to reopen negot : a±ions for an amalgamation.

Mr A. Jones, a director oi the Marketing Association, said that when the constitution of Amalgamated Dairies had been put before the directors of the Marketing Association they had had no hesitation in refusing to consider further the proposed amalgamation. The constitution gave Mr William Goodfellow and Mr J. B. Wright enormous powers. These two men held 18,000 shares between them and the organisation could do very little without the consent of one or .other. The Marketing Association had consulted its partner, the Co-operative Wholesale Society, on the question, and the proposal for an amalgamation had been definitely turned down. He, personally, had seen 10 returns of a North Island factory which had divided the output between Amalgamated Dairies and two other marketing firms, and while Amalgamated Dairies had shown an advantage of 4d per ewt on one shipment over the others, it had been as much as 10s per cwt lower on others. In reply to a suggestion by Mr Fisher that the Marketing Association should have bought out Amalgamated Dairies. Mr MacFarlane said he had observed the operations of Amalgamated Dairies from the

London end, and lie went on to criticise Mr Wright's management. Amalgamated Dairies was not a co-operative organisation. It should be-remembered, however, that many other countries were supplying dairy produce to the London market, and any recurrence of price fixation should come about would lead to disaster. Ihe chairman (Mr H. J. Middleton) said he was not surprised that the proposals had been turned down. It had a ,,Y e , ry lop-f’ided proposal. risher: Would you have put up ony other proposal? The chairman: I would not have touched them with a forty foot pole.—(Laughter.)