Fonterra says it will start talking with its farmer shareholders next week on the next stage of its proposed capital restructuring, which would allow farmers to trade co-op shares among themselves reports The NZ Herald. "The Fonterra Board and Shareholders' Council have voted to support the concept of Trading Among Farmers and agreed that it should go out for consultation," says a press release just issued. Feedback from this process will be taken into account before any final plan is put to a farmer vote. Any proposal would require 75 per cent support of farmer shareholders voting. The new scheme would allow farmers to buy or sell their Fonterra shares among themselves, instead of purchasing or redeeming them through the co-op. The co-op will remain 100 per cent farmer owned and controlled. An earlier attempt to allow minority shareholdings from non-farmers was rejected before even being put to a vote. This time the co-op is moving slowly, ensuring farmer support before any change is proposed. Allowing share trading is part of the dairy giant's plan to reduce what it calls "redemption risk" - where millions of dollars of capital 'washed in and out' of the co-op depending on milk production levels.
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