Fonterra puts two execs on leave in wake of contamination

Fonterra puts two executives on leave in wake of contamination crisis

Aug. 14 (BusinessDesk) - Fonterra Cooperative Group says it has put two senior managers on leave, effective immediately, as it continues a probe into how three batches of whey protein got contaminated with bacteria that can cause botulism.

The Auckland-based dairy company didn’t identify the managers, who have been put on leave just two days after chief executive Theo Spierings accepted the resignation of NZ Milk Products managing director Gary Romano.

“We are moving quickly and establishing key facts about what has happened and, as they emerge, we are taking appropriate action,” Spierings said in a statement. Putting the managers on leave didn’t pre-empt the findings of the company’s operational review, he said.

Spierings said the company’s investigations will be completed by the end of the month. Fonterra is looking into the transparency of information in the business, and how that information is escalated to the appropriate levels, he said.

The company’s board is conducting its own inquiry.

The contamination was confined to 38 metric tonnes of whey protein concentrate (WPC80) manufactured at Fonterra’s Hautapu plant near Cambridge and first picked up at a plant in Australia. It was used in the manufacture of infant formula, juice and dairy beverages, yoghurt, body building powder, and animal stock food.

The threat to New Zealand’s reputation with Chinese consumers has put the government into over-drive to head off the risk, and it’s fast-tracking legislation to allow a speedy inquiry so Prime Minister John Key can front up in China to allay those concerns.

Units in the Fonterra Shareholders’ Fund, which give outside investors access to the dairy company’s dividend stream, were unchanged at $6.93.

(BusinessDesk)

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