Cavalier Just One of the Options, Says WSI

New Zealand Wool Services International Limited
MEDIA RELEASE

10 June 2011
Cavalier Just One of the Options, Says WSI

New Zealand Wool Services International (WSI) Chairman Derek Kirke said today that the Commerce Commission has granted authorisation to Cavalier Wool Holdings to join the process that has been going on to introduce a new shareholder. Cavalier may not be successful as it is just one of a number of contestants and will be facing stiff competition to acquire control of WSI’s assets.

“Receiving authorisation today from the Commerce Commission to acquire WSI’s scours to create a wool scouring monopoly is just the first hurdle for Cavalier.

Mr Kirke stated ‘Cavalier has been requested by WSI to provide details of its proposed offer; until that is received WSI cannot give any useful information to its shareholders. Any proposal from Cavalier must be assessed against any bids the receivers of Plum Duff and Woolpak Holdings receive for the 64% shareholding offered for sale. All offers are part of a strongly contested bidding process’

He said the decision marked the outcome of a costly and time-consuming process for all involved and would be seen by the wool industry as substantially reducing options and competition in the scouring market if Cavalier is successful in creating a monopoly.

“Mr Kirke said “ WSI is New Zealand’s largest single wool exporter and has materially improved its financial performance over the last 12 months. Shareholders have and will receive the benefit through dividends. WSI creates an option for all wool exporters to scour wool to a high standard at competitive prices. This has occurred against a backdrop of running interference in its markets over this time. During the past year WSI has increased its share of total wool scoured by more than 10%. This is the result of our superior quality and efficient processing performance

Mr Kirke said that WSI’s directors would pay close attention to the process, and provide input when needed, but that as the country’s largest wool exporter, the company will continue to focus on operating as a successful business.

“The sale process is going on in the periphery, but we have a responsibility to our shareholders to maintain our excellent recent performance, so we’ll be focussing on that.
Our overseas customers, wool grower suppliers, wool scouring customers and most important our loyal staff should rest assured that as far as the Board of WSI is concerned it is very much “business as usual”

“In fact today is the New Zealand launch of the hugely successful Prince Charles-led Campaign for Wool. It’s a global initiative to raise wool’s profile for the benefit of the entire industry and WSI is New Zealand’s largest individual contributor, so it’s a big day for the company and the wool industry,” said Mr Kirke.

The Campaign for Wool New Zealand launches tonight in Wellington in the Great Hall at Massey University.

ENDS

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