Video | Agriculture | Confidence | Economy | Energy | Employment | Finance | Media | Property | RBNZ | Science | SOEs | Tax | Technology | Telecoms | Tourism | Transport | Search


Zespri shareholders back constitutional changes

Zespri shareholders back constitutional changes according to preliminary vote count

By Rebecca Howard

March 14 (BusinessDesk) - Zespri shareholders voted in favor of constitutional changes aimed at strengthening grower ownership and control of New Zealand's statutory kiwifruit exporter, according to preliminary results from a special meeting held today in Mt Maunganui.

Shareholders voted on a series of resolutions that will impose a cap on the number of shares they can hold relative to trays of kiwifruit produced, and phase out dividends for non-producing shareholders over seven years. Existing growers who stop producing after the vote would cease getting dividends after three years, according to information distributed prior to the meeting. The preliminary results show changes to Zespri’s constitution were backed by more than 75 percent of shareholders.

Chairman Peter McBride said the aim is to address a problem of growing misalignment between growers who supply kiwifruit to Zespri and people who own shares in Zespri.

“A significant number of New Zealand kiwifruit orchard owners do not own Zespri shares and over 18 million shares are held by people who have left the kiwifruit industry,” said McBride.

The vote comes after shareholders in 2015 approved plans to strengthen grower control amid concerns about an increasing misalignment between producers and shareholders. The changes required an amendment to the Kiwifruit Export Regulations last year.

Of Zespri's 120.7 million shares on issue, some 18.1 million are held by people no longer connected with the kiwifruit industry and a further 29 percent are held by producers at a ratio of below one share per tray, which Zespri deems "under-shared". At the other end of the spectrum, 8 percent of the shares are held by producers at a ratio of more than four shares per tray, known as "over-shared".

Zespri wants to aim for a ratio of one share for one tray produced but the new cap would set the limit at four shares per tray. Voting entitlements would be set at the lesser of one voting share per tray or the total number of shares the producer holds. The changes also take into account the rights of owners and lessees of kiwifruit orchards.

Another resolution addressed the misalignment of shares by giving Zespri the right to issue, buy back and distribute shares. This was also supported through a shareholder resolution and is planned for the second half of this year, Zespri said. It will be based on an independent valuation and target a share issue to unshared and under-shared growers, and a buyback offer to non-producers and over-shared shareholders.

"The changes will come into effect over a number of years, with a substantial transition period in place," said McBride.

Zespri shares last traded at $7.70 on the Unlisted platform, giving the company a market capitalisation of about $930 million. The stock will be halted on Wednesday and Thursday to allow Zespri to update its record of shareholdings.They began trading on Unlisted in early 2016 and have soared 340 percent since then.

The final voting results from the meeting will be confirmed by the close of business Thursday.

Kiwifruit is New Zealand's fastest-growing horticultural export and the Ministry for Primary Industries is forecasting more growth in the next two years, with exports to reach $1.8 billion in 2019. Zespri is aiming for $4.5 billion of global sales by 2025. In the next five years, the monopoly export authority plans to release 3,750 hectares of licences for its more profitable, sweeter SunGold variety.


© Scoop Media

Business Headlines | Sci-Tech Headlines


Conservation Win: Mice Eradicated From Antipodes Island

In a world-leading conservation effort, mice have been successfully eradicated from Antipodes Island in the New Zealand Subantarctic, Conservation Minister Eugenie Sage announced today... More>>


Transport Tech: Roadmap To Harness $1.5 Bn Sector

A new Future Technology Leadership Group will help New Zealand harness some of the $1.5 billion a year estimated value to the economy from Intelligent Transport Systems (ITS) as well as the social benefits they create... More>>


Economy: GDP Rises On Strength In Services

The economy, as measured by gross domestic product (GDP), grew 0.6 percent in the December 2017 quarter, Stats NZ said today. Growth was driven by increases in the service industries but was tempered by falls in the primary sector. More>>


Dolphins In Danger: More measures to protect

Fisheries Minister Stuart Nash and Conservation Minister Eugenie Sage are accelerating work to improve protection of the nationally endangered Hector’s dolphin, after five were accidentally killed in a fishing net off Banks Peninsula. More>>


Innovative Partnerships:Govt Launches R&D Programme

Research, Science and Innovation Minister Megan Woods has today formally launched the Innovative Partnership programme which aims to attract future-focused international innovators and firms to undertake R&D and develop their products in New Zealand.... More>>


Planes And Oil: Current Account Deficit Widens To $2.0 Billion

New Zealand's seasonally adjusted current account deficit widened to $2.0 billion in the December 2017 quarter, Stats NZ said today. The $407 million increase in the deficit was mainly driven by New Zealand importing aircraft and other transport equipment, and crude oil. More>>


RMTU: Lyttelton Port Strike

Sticking points now include LPC’s insistence on docking the pay of workers who didn’t take part in strike action last week – because they withdrew the strike notice. “In our view this amounts to an illegal lockout.” More>>


"Licensed To Krill": Greenpeace Report On Antarctic Fishing

A new Greenpeace investigation has exposed the environmental risks of the fast-growing krill industry in one of the most pristine parts of the Antarctic Ocean. More>>