Mega co-op up in air as Leeder quits

By Philippa Stevenson

agricultural editor

Popular New Zealand Dairy Group chairman Doug Leeder quit yesterday to the shock of his company shareholders and the industry.

Last night farmers throughout the country said they were gutted and disappointed at the resignation of a man many regarded as having vision and integrity and who they had hoped would lead them well into the future.

Mr Leeder cited personal reasons for standing down from the chairmanship he has held for only a year and said he would consult with suppliers in his Bay of Plenty home region before deciding whether to continue as a director.

The resignation comes at a crucial time for the industry which is battling historic rivalries between Waikato-based Dairy Group and Taranaki's Kiwi Dairies to form the proposed nationwide mega co-op.

Since 1995, when he was chairman of the Bay Milk company Mr Leeder has been one of the key drivers of the initiative. His appointment to head Dairy Group, with which Bay Milk merged in 1997, is thought to have been crucial to turning the tide of opinion on the board which had long and vociferously opposed a one-company strategy.

However, he has struggled to contain board factions and last night sources said his departure may tip the balance towards those who feel the Dairy Group can successfully go it alone.

His resignation throws into doubt the deal that emerged from a two-day industry summit 10 days ago, which aimed to bring together the Dairy Group and Kiwi with Northland Dairy. The summit had ostensibly resolved the contentious issue of share structure for the mega co-op, one of the major blockages to its formation.

In reaction to Mr Leeder's resignation last night, Bay of Plenty farmer Catherine Bull was confident that he would get "overwhelming" support to stay on as a director.

"He had a vision for the wider industry. Who is going to take his place? I'm worried about the future of the industry," she said.

A Waikato shareholder said he expected farmers to be annoyed at the loss of a leader who related well to farmers and whose departure left a board relatively light on experience. Mr Leeder's resignation follows quickly on the electoral ousting of 20-year director John Storey, who was also Dairy Board chairman.

Dairy Farmers of New Zealand chairman Charlie Pedersen said the move by a man viewed as eloquent and with huge potential had taken the industry by surprise.

Mr Pedersen said he had been concerned for sometime at the personal sacrifice being made by both elected leaders and industry executives because of the massive workload brought on by plans for the mega co-op.

Dairy Group deputy chairman Henry Van Der Heyden said the board had accepted Mr Leeder's resignation with regret, but respected his decision.

"Our priority is to ensure New Zealand Dairy Group maintains its leadership position in dairy industry restructuring," he said.

The company is expected to elect a new chairman today.