Commerce Commission approval is given for Fonterra to take over troubled NZ Dairies from receiver

Commerce Commission approval is given for Fonterra to take over troubled NZ Dairies from receiver

Approval for Fonterra's purchase of NZ Dairies plant off the recievers will be welcomed by all farmer suppliers and workers at the troubled plant.

From earlier reports a reasonable deal was able to be negotiated so that suppliers recieved  last years milk payments and a sensible time frame to finance the big shareholding required.

All of South Canterbury and North Otago will breathe a collective sigh of relief at being able to retain an important economic asset in their area.

Fonterra welcomes the decision of the Commerce Commission to approve the acquisition of the assets of the New Zealand Dairies Ltd group in South Canterbury. The Studholme site becomes the Co-op’s 27th processing factory and the 11th in the South Island accepting about 800,000 litres of milk a day from former NZDL suppliers and Fonterra shareholders.

Fonterra CEO Theo Spierings said the Commerce Commission’s decision provided certainty for NZDL’s suppliers and would be a welcome addition to the Co-op’s processing capacity. “This investment in the Studholme plant underpins our commitment to the dairy industry in Canterbury, one of the fastest growing dairy regions in New Zealand. We’re pleased we have been able to offer certainty to the former suppliers of NZDL and staff at the factory.

“The Studholme site also complements our new Darfield plant operating for the first time this season.”“We’ve been operating the Studholme plant for the receivers over the past couple of months to ensure supplying farmers could sell their milk from the start of this season,” he said.

“We started collecting milk from NZDL suppliers at the beginning of August and processed it at other sites and fired up the Studholme plant on August 14. We’re now processing more than 800,000 litres per day of milk into whole milk powder for export.”From 15 September 2012, NZDL suppliers will become Fonterra contract suppliers with the ability to become Fonterra fully share backed after the 2012/13 season.

Mr Spierings said the acquisition also strongly aligned with Fonterra’s Strategy Refresh, which identified the importance of growing milk volumes and optimising New Zealand manufacturing operations.The Russian-owned dairy factory was placed into receivership on 17 May 2012. Receivers BDO Chartered Accountants called for bids to buy the business and assets of NZDL shortly after.

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So pleased to see Fonterra use our payout to pay over the top for this second rate factory.
also note their willingness to bail out non shareholding or supplying  farmers , contrasts sharply with their attitude to sharemilkers who are persona nongarata.

Well, the Russians put it into recship.
Why has fonterra paid monies otherwise owed by the Russians...
So does this mean that synlait has also an implicit guarantee.
Agree, the suppliers would have otherwise been unsecured creditors
So in effect the banks are getting a break too for the main supplier borrower would otherwise .........
We said the story would run..

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