March 25, 2008

Merger in New Zealand meat industry hits deadlock
 

Negotiations on the proposed consolidation of New Zealand's meat industry seem to be headed to a deadlock, raising concerns among farmers belonging to the Natural Producers Company cooperative.

Chairman of the NPC, Tuturau farmer Murray Rohloff, said the organisation would lobby for farmers' best interests during the consolidation process. He said, however, that what matters now is that Alliance Group Ltd and PPCS Ltd get over their animosity and past rivalries.

Alliance and PPCS together account for 59 percent of sheep meat, 37 percent of beef and 78 percent of venison exports.

According to Rohloff, personal ties, goodwill and mutual understanding were essential in building mergers.

The mega merger will create one entity that will manage 80 percent of New Zealand's livestock supply from farm to market.

The move will consolidate five mega companies, including Alliance and PPCS, into one. It seeks to generate revenue of about US$5 billion and raise on-farm returns by about US$400 million each year.