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Majority Vote For New Fine Wool Company

June 29, 2001

New Zealand's merino growers have given a solid mandate to the new fine wool company proposed by Merino New Zealand and Wrightson.

The vote, which closed last Friday (June 22), indicated a strong majority of growers were in favour of the new venture, which has been developed and refined over the past year in consultation with growers and the wider industry.

Merino New Zealand chairman John Perriam said it was positive to see growers giving the proposal their support, with 66 per cent of those voting expressing their confidence in the new venture and 69 per cent behind the use of NZ$1.3 million in reserves, to provide capital for the new company.

The vote was ninety per cent in support of Merino New Zealand Incorporated continuing as the distributor of the portion of compulsory levy designated for merino-specific research. John Perriam says this reflects grower approval for the role Merino New Zealand has played in the industry since its inception six years ago and the expectation and confidence in moving forward.

In addition to the two to one majority vote in favour of The New Zealand Merino Company, some 90 per cent of those supporting its formation indicated their intention to support the new company with their merino clip, with others keen to support it, if an accord with other brokers can be made.

Growers also voted, 88 per cent in favour of Wool Board merino reserves being calculated on levies paid to the three years ending June 30.

"One of the ongoing challenges we now face is to reach an agreement within the industry to accommodate those growers who have strong traditional ties to other industry stakeholders. If this can be achieved, then growers and stakeholders will reap the benefits of unity, which will add value to our industry as a whole," John Perriam says.

While there was no legal requirement to undertake a grower vote, Merino New Zealand's board and executives chose to conduct the poll to gain a clear understanding of grower opinion. "The vote results, which represent around 90 per cent of total merino sheep numbers, will assist us in the decision-making process."

John Perriam says that Merino New Zealand has already established itself as an innovative, forward-thinking and grower-focussed organisation, and he believes those qualities will transfer to the new commercial entity.

Wrightson Managing Director, Allan Freeth, said that it was pleasing to see the strong level of grower support for the new joint venture, and that he believes it is an acknowledgment of the success of both Wrightson and Merino New Zealand in generating value for growers in the past.

The process from this point is to carry out consultation with major investors and stakeholders, including the New Zealand Wool Board, the Implementation Project Team and strategic partners. In accordance with this process, it is expected that further information will be made available in approximately seven to 10 working days.

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