Farmers around the country have voted in favour of a
controversial proposal to allow outsiders to invest in dairy giant
Two-thirds voted for the Trading Among Farmers plan.
But in a twist, a second resolution did not get the support it needed.
The TAF scheme will allow farmers to trade shares with one another, or sell shares to a fund which then sells units, worth no more than 20% of Fonterra's total shares, to outside investors.
Such is the level of feeling about the plan that Fonterra would not let ONE News film today's meetings.
Farmers continue to worry that letting outsiders invest in their co-operative will ultimately lead to a loss of control.
Among comments from farmers voting against the scheme today were that it takes Fonterra too far away from tried and proven co-operative principles, it is not needed and that it has not been well enough tested.
They also say 50% is not enough and that 75% shareholder support should be required to see it pass.
"Anything less than that will actually create a rift in the shareholder base," said Allister McCahon, a Dargaville farmer.
But those in favour said the scheme is a huge benefit to Fonterra and there are plenty of checks and balances so it cannot be hijacked by unit investors.
In the end, just under 67% voted in favour of the scheme.
"Two out of every three votes are supportive of TAF which we
think is a mandate for us to proceed," said Fonterra chairman Sir
Henry van der Heyden.
Despite that, concerns remain.
"Once farmers have made that economic decision to sell down their shareholding, often farmers find it very difficult to buy back into their co-operative," said Lachlan McKenzie, former Federated Farmers Dairy chairperson.
A second resolution designed to further protect farmers, failed.
But the scheme will go ahead and Fonterra will put the measures contained in the second resolution back to a vote at their Annual General meeting in November.
Call to unite
With 66% of Fonterra shareholder-suppliers backing Trading Among Farmers, in an 85% turnout, Federated Farmers is calling on the co-operative to unite.
"Whatever the result, we wanted it to be clear one and the shareholders have delivered it. It was a reasonable voter turnout," says Willy Leferink, Federated Farmers Dairy chairperson.
Attention now turns to completing the parliamentary stages of the Dairy Industry Restructuring Amendment Bill (DIRA) which will give effect to TAF, Leferink said.
He said there has been a lot of debate and some shareholders may feel embittered by the result.
"I am asking them to hang in there to see if the many promises made about TAF are delivered."
Primary Industries Minister David Carter had hoped the Dairy Industry Restructuring Bill would be passed before today's vote, which has been held up by delays getting the asset sales legislation through.
Carter hopes to get the Bill to the committee stage this week.
Fonterra says it expects to have the scheme in place in
November, provided conditions are met, including the enabling