Apple Industry Risks Lie With The Shareholders
The revelation that ENZA has increased its indebtedness on foreign exchange transactions will be a major shock to its shareholders, ACT Rural Affairs Spokesman Owen Jennings said today.
“Reports alleging that this debt is now equivalent to over $4.00 per carton is further testimony to the high cost structure that growers have struggled with in recent years. These debts, past and present are the liability of the shareholders.
“When new players purchased the shares of ENZA they bought into all of the risks and opportunities that went with the organisation.
“Last-ditch attempts by new shareholders to sheet home past debts and new liabilities to former shareholders is not acceptable.
“The price of the shares paid by incoming participants reflects what they considered the value of those shares to be, warts and all.
“If they made a mistake in paying either too much or too little, they face the consequences. They cannot expect their suppliers who may not be shareholders to stump up with money for any shortfalls that may now be apparent. If they are shrewd enough to pay suppliers a lower price in an effort to build a bigger profit to cope with past liabilities, so be it. They cannot require all suppliers including non shareholders to accept a share of repaying past debts.
“Further, attempts to create levies over all growers to fund these debts should be rejected outright. Such suggestions are a nonsense and defy commercial reality and practice,” Owen Jennings said.