Growers seek Enza board revamp

By PHILIPPA STEVENSON agricultural editor

Enza's small-grower shareholders have united to challenge the corporate domination of the board of the $600 million apple exporter.

Yesterday, the Enza Shareholder Voting Trust, with voting rights for 17 per cent of shareholders, said it wanted to replace three board directors with grower representatives, and have an independent chairman.

Trustee and Hawkes Bay orchardist Paul Paynter was confident grower shareholders had the weight to overhaul the entire board, but said most recognised the value of the corporate shareholders.

Small-supplier shareholders own about 60 per cent of Enza, and the move challenges Guinness Peat Group and FR Partners.

They have dominated the six-member board since a raid on Enza shares in July netted them nearly 40 per cent. GPG's Tony Gibbs has been Enza's chairman since August.

Mr Paynter said the trust - like any single shareholder - could only hold an interest of up to 20 per cent in Enza, but it also had the support of a further 10 per cent of grower shareholders who had pledged their proxy votes.

He understood another grower trust was aggregating votes "and if push comes to shove I am quite sure we can achieve a majority in any vote."

Mr Gibbs said he did not regard the trust's approach as hostile, and would be happy to meet it in about two weeks.

Everyone on the board was a grower, and the grower body, Pipfruit Growers NZ, had a representative in director Richard Hill, he said.

"I don't know what difference they are really trying to drive at.

"We are trying to make the company more efficient and ... not make any more wars."

Mr Paynter said the trust anticipated a seven-member board made up of three directors from GPG and FR, three grower representatives and an independent chairman.

"These [GPG and FR] guys have some good commercial acumen but have a limited understanding of the apple business and the international fruit-trading business.

"As growers, we are going to live or die on the decisions they make and it is imperative, with over 60 per cent holding in the company, that our interests are represented.

"We are not in a financial position to allow these guys a couple of years to learn the ropes.

"We have to ensure our interests are looked after."

The trust said Enza's focus could not be on shareholders at the expense of suppliers.

"Enza and its suppliers must be in a sound, balanced partnership if the industry is to return to full profitability," Mr Paynter said.

The trust would not disclose director candidates until it had talked to GPG and FR, he said.

Meanwhile, Mr Gibbs said the industry review commissioned by the board would not be finished until early next month.

He anticipated the report would be a "blueprint for the way forward."