Norgate wins GlobalCo reins

By PHILIPPA STEVENSON agricultural editor

Craig Norgate rang his mum in Hawera at 6.15 am yesterday, waking her up to tell her he was now the head of New Zealand's biggest company.

Faye Norgate said the first chief executive of the $12 billion Global Dairy Company sounded much more relaxed than he had been a few days before.

When she visited her 36-year-old son at his Auckland home during the weekend, she said, he had been "fairly toey."

Hardly surprising, perhaps, when Mr Norgate faced the imminent prospect of the final interviews for the $1 million-a-year job, which was also being sought by top Dairy Board executives Chris Moller and David Pilkington.

But yesterday Global Dairy Company's chairman John Roadley ended months of industry infighting over who should head the new company by naming Mr Norgate.

"Craig has the huge responsibility of leading New Zealand's biggest company into the deregulated environment," he said.

"In Craig we have someone uniquely suited to head the new business we are creating. He has a track record of business growth, astute commercial decisions and strong leadership."

The appointment was made on the recommendation of a board subcommittee consisting of Mr Roadley, Kiwi chairman Greg Gent, Dairy Group chairman Henry van der Heyden, and two independent global directors, Graeme Hawkins and John Hood. It was assisted by multinational recruitment agency Korn Ferry.

The end to the months of indecision of who would lead the merged company was widely welcomed - not least by the new chief executive's proud mum.

"He'll be able to sleep now," said Mrs Norgate, whose late husband, Frank, was once a general manager of the tiny Taranaki company Kiwi Dairies that her son has helped turn into a potential world-beater.

Her youngest son, Geoff, is also in the dairy industry as general manager of Mainland's dairy division.

Craig Norgate followed in his late father's footsteps, joining Kiwi 10 years ago and becoming boss at the tender age of 26.

The annual turnover of the small manufacturer was then $300 million.

This year, when Kiwi and the larger New Zealand Dairy Group agreed to merge, and amalgamate with the exporting Dairy Board to form GlobalCo, its turnover was $3.9 billion.

Dairy Group chief executive John Spencer welcomed Mr Norgate's appointment, confident that he had deservedly won the position after a robust selection process.

"He will have my full support and that of the senior management of Dairy Group."

The two chief executives have worked closely on the GlobalCo proposal and its business plan over the past two years and Mr Spencer said he had gained a high respect for Mr Norgate's abilities.

His key attributes were his passion, his experience as a chief executive, his knowledge of the industry and what was now required to achieve its goal of growing from the ninth-biggest dairy company in the world to one of the top three.

While Mr Norgate was picked as a frontrunner for the position, some commentators suggested a lack of experience in the international dairy market would count against him.

Mr Spencer said all chief executives had strengths and weaknesses.

"Any good chief executive has to ensure they have people around them who have the strengths in the areas in which they may have weaknesses."

With the twice-postponed appointment made, Mr Spencer expected the merging of the two companies and the Dairy Board to accelerate.

"Wheels have been spun from the time of the [June 18 merger] vote till now waiting for the chief executive to be appointed. The momentum will now pick up."

Another industry commentator said Mr Norgate had "a bit of magic."

"He's got charisma based on performance. He's larger than life and has taken a company as small as Kiwi was and turned it into a winner that could go toe to toe with New Zealand Dairy."

"That's exactly what the united New Zealand dairy industry now has to do to the rest of the world."

Mr Norgate said his first priority was the staff of the new giant.

Following that theme, he met the Dairy Board team in Wellington yesterday morning and got together with his old Dairy Group rivals in Hamilton in the afternoon.

"While the buck will stop with me, the success of the industry depends on the efforts of all staff and they are my overriding priority," he said.

"The task of putting the three businesses together is upon us, and I will be making every endeavour to ensure that goes smoothly."

When Kiwi moved its corporate office to Auckland last year, the Norgate family - wife Jane and three pre-teen children, Dylan, Jordan and Alexandria - broke their bonds with Hawera and Taranaki and also moved to Auckland.

Mr Norgate, the young accountant of the year in 1994, has attended Harvard Business School and is also a director of the New Zealand Rugby Football Union.

He was for a long time a strong advocate of a united dairy industry but one which retained its cooperative structure.

Last year, he said he believed New Zealand farmers had the ability to own a significant share of one of the few global food companies that would exist in 20 years. GlobalCo was New Zealand's one chance to have a world-scale business.

At the merger announcement in December - six years after the mega cooperative proposal was first mooted - he acknowledged the challenges the industry faced.

"All we've been through, and it's just the end of the beginning.

"We just want to get through to the other side of this process very quickly and unleash all the energy this industry's got, and make sure we realise its full potential."

The merged company he now heads controls about 95 per cent of the country's milk production.

When it starts operations in October, it is likely to have revenue totalling $12.2 billion, making it the ninth-biggest dairy company in the world.

As well as helping select a name and branding for the new company, Mr Norgate must integrate the three separate entities, prepare the company for the loss of the Dairy Board's export monopoly, and deliver the 14,500 farmer suppliers annual efficiency and synergy benefits of $310 million within three years.

Time will show what new magic Craig Norgate can conjure, but his mum is confident. She knows her bright, hard-working son loves a challenge.