Change at top MSL’s ‘only chance’

Daily Mercury - - FRONT PAGE - Camp­bell Gel­lie camp­bell.gel­lie@dai­ly­mer­

EX­CLU­SIVE: Mackay Sugar will have to sur­vive its most dif­fi­cult time with a new leader af­ter long-serv­ing chair­man

An­drew Cap­pello stood down from the top job.

The shock res­ig­na­tion comes soon af­ter what some de­scribed as ‘the worst

AGM the com­pany had ever had’.

Mr Cap­pello had been chair­man for seven years, dur­ing the most chal­leng­ing pe­riod in the com­pany’s his­tory.

Be­set with bal­loon­ing debt, poor milling per­for­mance and shrink­ing crop sizes, the miller is nowhere near out of the woods, prompt­ing Mr Cap­pello to pass the reins to Mark Day.

Some in the in­dus­try be­lieve this could be the move that keeps the com­pany in the hands of its grow­ers.

Mackay Sugar is search­ing for an an­gel in­vestor to save it from be­ing taken by the banks be­cause of its $180 mil­lion debt and poor per­for­mances over past years.

The com­pany was try­ing to re­fi­nance by sell­ing its prof­itable Race­course co-gen­er­a­tion plant, Moss­man Mill and im­pos­ing a $2 a tonne levy on grow­ers.

How­ever, that plan has been put on hold af­ter a le­gal chal­lenge to the levy by some grow­ers and lower than ex­pected bids for the co-gen­er­a­tion plant.

Mr Cap­pello and Mr Day both de­clined to be in­ter­viewed by The Daily Mer­cury yes­ter­day.

A state­ment from Mackay Sugar said the de­ci­sion came af­ter the Oc­to­ber an­nual gen­eral meet­ing.

Grower and for­mer di­rec­tor Rex Strop­pi­ana, who led the le­gal chal­lenge against Mackay Sugar’s $2 levy and won, said it was the worst AGM the com­pany had had, grow­ers up­set by a pro­posal to shut down one of the com­pany’s four mills to cut costs.

“The share­hold­ers lost all re­spect for the board and man­age­ment at that meet­ing,” Mr Strop­pi­ana said. “Hope­fully, this is a new be­gin­ning of some sig­nif­i­cant change.”

For­mer board mem­ber and mill man­ager Barry Sheedy has thrown his weight be­hind Mr Day, say­ing he was the com­pany’s best chance of sur­vival.

“Mr Day is (Mackay Sugar’s) only chance of get­ting them to pull through and he will need a lot of sup­port,” he said.

“He is suf­fi­ciently ex­pe­ri­enced to recog­nise the prob­lem and take the steps to fix them but he will need the sup­port of the banks to re­store that po­si­tion be­cause you can’t do it with­out a lot of money.”

Mr Sheedy was Farleigh Mill man­ager for 13 years and a di­rec­tor of Mackay Sugar from 1994-2005.

When Mackay Sugar formed, the Farleigh Mill brought $15 mil­lion into the new com­pany.

“This is ter­ri­ble I don’t want to see Mackay Sugar be­ing sold to some­one else,” he said.

“It will at least be a 10-year fix for (Mackay Sugar) to trade out of their prob­lems and crit­i­cally they need to re­store the con­fi­dence of the grow­ers in the milling com­pany.”

Cane­grow­ers Queens­land chair­man and Mackay Sugar grower Paul Schem­bri said Mr Cap­pello had been un­der a lot of pres­sure.

He said Cane­grow­ers had never ques­tioned Mr Cap­pello’s com­mit­ment towards the com­pany, his job and the share­hold­ers.

But he too was look­ing for­ward op­ti­misti­cally, be­liev­ing this change could bring the grow­ers to­gether to keep the busi­ness grower-owned.

“Now we need to sup­port our new chair­man and move the busi­ness for­ward,” he said. “Let’s make no bones about it, the busi­ness is in a dif­fi­cult sit­u­a­tion but we need to come to­gether be­cause the destiny is in our hands.”

Mr Day joined the board as a non-grower di­rec­tor in May af­ter spend­ing three and a half years in Brazil as op­er­a­tions di­rec­tor for eight sugar cane fac­to­ries owned by Bunge Brazil.

Prior to that he had an ex­ten­sive ca­reer with CSR/Wil­mar in sugar, man­ag­ing CSR’s cane sugar busi­nesses as ex­ec­u­tive gen­eral man­ager for six years and two years in In­done­sia with Wil­mar on ex­pan­sion op­por­tu­ni­ties in that re­gion.

Pre­vi­ously he worked for CSR as a shift su­per­vi­sor in the Mackay re­gion in 1980.

Mr Cap­pello will re­main on the Mackay Sugar board.

There had been re­ports Bunge, the Brazil­ian com­pany which Mr Day worked for had been in­spect­ing Mackay Sugar to pos­si­bly buy it.

Mr Schem­bri con­firmed Bunge staff had been in Mackay last week but did not speak to him about Mackay Sugar.

A Bunge spokesper­son said the com­pany had no in­ter­est in the sugar in­dus­try.


STEP­PING ASIDE: For­mer Mackay Sugar chair­man An­drew Cap­pello stood down from the top job yes­ter­day.

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