Cottee directors named in export scandal

By PHILIPPA STEVENSON, Agricultural editor

An international dairy industry publication has named two New Zealand executives as the men suspended during investigations of the "Powdergate" illegal exporting scandal.

The Europe-based Dairy Industry Newsletter reported in its November 13 edition that the pair were Paul Marra, chief executive of Kiwi Dairies' Food Solutions Group, and Malcolm McCowan, general manager of Kiwi Milk Products.

The publication, a popular source of industry news in Europe but also available in New Zealand, appears in abbreviated form on a similarly titled website.

Kiwi's successor, Fonterra, yesterday refused to confirm or deny that the men were the two employees chairman John Roadley said last week had been suspended on full pay.

"It is not disciplinary action and therefore it is inappropriate to name them," said spokesman Matthew Hooton.

Asked whether not denying it was the pair could be unfair to them, Mr Hooton said Mr Marra and Mr McCowan could "take their own action, if they think that's appropriate, against people who name them".

Receptionists at their Auckland workplaces yesterday said neither was available.

Asked the whereabouts of the key executives, Mr Hooton was unable to say where they were.

Mr Marra, aged 51, is a 35-year dairy industry veteran who started his career in the Bay of Plenty, moving from Bay Milk to operations manager of the Lactose Company before joining Kiwi in 1993. He became chief executive of Food Solutions in December 1999.

Company records in New Zealand and Australia show he is a director of at least nine companies, including New South Wales-based Cottee Dairy Products and Australasian Dairy Ingredients, which are at the centre of the illegal exporting allegations.

Mr McCowan, 51, also a director of Cottee and at least two other Kiwi subsidiaries, was appointed to his position at Kiwi in April 1997 after leaving the Dairy Board, for which he had been based in Chile.

In this year's annual report, Kiwi chief executive Craig Norgate (now head of Fonterra) said the year-old Food Solutions Group, formed from the ingredients products divisions of the merged Kiwi and Northland companies, had more than doubled its turnover in the May year.

The group's sales were $388 million and net profit before tax was up by 52 per cent, he said.

Kiwi Milk Products, part of the Food Solutions Group, had had "a milestone year, consolidating its position as the number one dairy ingredient supplier in New Zealand", the report said.

Also under the Foods Solutions banner are Cottee Dairy Products; an Israeli joint venture, Ba'Emek Technologies, which produces whey protein concentrate and lactose; Maverik, which specialises in dairy flavour technology; a nutraceuticals business; and Kiwitech, a research division.

Meanwhile, an Australian company named in a letter from Mr Roadley to Fonterra shareholders last week in connection with possible illegal exports originating from New Zealand Dairy Group has rejected any involvement.

Mr Roadley said Dairy Group subsidiary New Zealand Dairy Ingredients had sold 794 tonnes of dairy products to Biocorp and Probiotec that might also have been exported without Dairy Board approval.

Probiotec chief executive Wayne Stringer said his Queensland company had a long history with the board, now Fonterra, and "every grain of product has gone through the board".

His company had no knowledge of any illegal transactions and "to the best of my knowledge every single bit of product that we've ever purchased out of New Zealand has been with the board's knowledge, and it must have been because we've actually paid a commission to the board on every transaction".

The owner of Auckland-based Biocorp, Stephen John McRae, has not returned calls.