KEY POINTS:
The fallout from the failed meat industry mega-merger is becoming increasingly bitter.
One of the parties courted in the failed merger has accused PPCS of trying to make Alliance Group chairman and merger instigator Owen Poole look unprofessional by releasing details of the talks.
Anzco chairman Graeme Harrison
said PPCS was playing farmer-politics and he questioned whether the Dunedin meat co-operative ever intended engaging in the merger process.
He was reacting to a letter released by PPCS last Monday which set out its reasons for not signing a co-operation agreement required by Alliance and a time-line of negotiations.
He said releasing such details breached confidentiality and was not accepted business practice.
Meanwhile, PGG Wrightson and Meat and Wool New Zealand urged farmers to remain confident, saying the formation of Fonterra was similarly interrupted by blood-letting at a similar stage in the dairy industry merger.
"We had plenty of stoushes, blood-letting and handbag-swinging, and often it came down to personalities," said PGG Wrightson chairman and former Fonterra chief executive Craig Norgate of the dairy merger.
Harrison added to the perception that PPCS was being isolated by other meat companies, as fallout from the failed merger reveals mistrust and ill-feeling.
"I have absolute full confidence in entering the process with Owen Poole as chairman of Alliance. I can't say that about the other co-op."
Harrison stressed he was not "slagging off" PPCS, which he has previously worked with. Rather, he was reacting to the company's actions on this issue.
PPCS would not sign the co-operation agreement required to advance the mega-merger, citing concerns about the process and that companies such as Anzco wanted to retain their beef business, which PPCS feared would undermine savings from a merger. Harrison described the beef concerns as a "smokescreen". His merger and acquisition experience indicated PPCS did not want to pursue a merger.
Anzco was prepared to engage in the process in good faith and consider selling assets to the new entity, but Harrison said he would not enter into a similar process again.
"I will not waste our time or upset employees of the company or shareholders by having another public debate."
Rationalisation would occur based on commercial decisions, but Poole had tried to fast-track that process by merging five companies into one, getting parties involved and then seeing what eventuated.
Ultimately that required "a meeting of minds" between the two co-operatives, PPCS and Alliance, and while Poole could have been seen as "dogmatic", Harrison said he had acted professionally throughout.
Norgate said PGG Wrightson would if necessary initiate discussions between meat companies, but parties needed time to catch their breath, take stock and determine the issues.
"We will act behind the scenes, but they need to all sit in a room and talk, not play games in public."
Meat and wool chairman Mike Petersen said while the Alliance concept was dead, he was concerned at the loss of goodwill.
He confirmed that Sir John Anderson, chairman of the board-commissioned Meat Industry Task Force, was to meet PPCS and Alliance in Dunedin last Wednesday night to broker a deal, but such was the animosity it was cancelled.
Petersen said the future of the task force would be reviewed as any consolidation would now be driven by commercial decisions.
The force was established this year to find "options that will provide a better future for our farmers and industry".
"We can do all we can to try and put parties together and find a direction for the industry to focus, but in the end it is up to commercial companies to buy into that."
Petersen was still optimistic the meat industry would be restructured.
- OTAGO DAILY TIMES
