May 23, 2011

 

Wesfarmers ignores farmer shareholder meeting request

 

 

A request from lobby group Australian Dairy Farmers to organise a general meeting to account the milk price war has been refused by retail giant Wesfarmers.

 

Under corporations law, the lobby group had enough signatures to call the meeting and wrote to the company earlier in the week.

 

Wesfarmers, as the parent company of Coles, said it has legal advice saying the Australian Dairy Farmers' proposed resolutions relate to management matters and would be legally invalid.

 

In a statement, Wesfarmers said the company's managing director Richard Goyder would be happy to meet with dairy farmers to explain the pricing strategy.

 

The dairy farmers wanted an EGM to consider two resolutions. The first is to explain the dairy pricing of its subsidiary, Coles, and the second to stop the price cuts.

 

Wesfarmers' chairman Bob Every said the company is committed to a strong relationship with suppliers and believe the best approach to discuss milk pricing issue is through direct discussion.

 

Australian Dairy Farmers is disappointed with Wesfarmers' decision.

 

The group said while it had its own legal advice on what resolutions to put to the board, its pockets are not as large as the company it is up against.

 

Vice president Adrian Drury said it was not a waste of time trying to force the meeting.

 

Wesfarmers has told the Australian Dairy Farmers Limited it will not be calling the extraordinary general meeting the ADF has requested.

 

Wesfarmers' Chairman, Dr Bob Every, said the Wesfarmers Board had independent legal advice that the ADF's proposed resolution related to management matters and would be legally invalid.

 

Every said he understood the milk and dairy pricing strategy of Coles was of concern to the ADF and the shareholders who requested the general meeting and invited them to discuss their concerns with Wesfarmers' Managing Director, Richard Goyder.

 

"I would urge the ADF to take up this invitation," Every said. "Wesfarmers is totally committed to a strong and enduring relationship with our suppliers and dairy farmers and believe the best approach to dealing with the milk pricing issue is through direct discussion."