Fonterra farmers will have to vote twice, two years apart, before the big cooperative will be able to transfer its assets to a subsidiary company and list it on the NZX.
Under proposals announced today:-
* In each shareholder vote, a 75 per cent approval will berequired, but directors have said they would prefer an 85 per cent endorsement.
* The first vote, expected in May 2008 will be to split Fonterra into a milk-supply cooperative and a subsidiary company, and to introduce a more transparent milk-pricing mechanism.
* Farmers will still have 100 per cent ownership of the companies.
* Each company will have 10 directors.
* The cooperative will have eight farmer-elected directors and two appointed independents. Six of the farmer directors will also sit on the subsidiary company, with four independent directors.
* The same farmer-director is expected to chair both the cooperative and its subsidiary.
* Over two years Fonterra will refine its milk pricing, build farmer confidence, and seek acceptable sharemarket conditions, listing value and enabling legislation.
* In 2010, farmers will vote again on whether the Fonterra subsidiary should list on the NZX and sell shares to raise external capital.
* Directors expect that the farmer-owned cooperative will at that stage own 65 per cent of the listed company, farmers will individually hold another 15 per cent stake, and about 20 per cent will be sold to institutional investors and members of the public.
