Zespri vote heads for change
Zespri shareholders voted in favour of constitutional changes aimed at strengthening grower ownership and control of New Zealand’s statutory kiwifruit exporter, according to preliminary results from a special meeting yesterday in Mt Maunganui.
Shareholders voted on a series of resolutions that will impose a cap on the number of shares they can hold relative to trays of kiwifruit produced, and phase out dividends for nonproducing shareholders over seven years. Existing growers who stop producing after the vote would cease getting dividends after three years, according to information distributed before the meeting.
The preliminary results show changes to Zespri’s constitution were backed by more than 75 per cent of shareholders.
Chairman Peter McBride said the aim is to address a problem of growing misalignment between growers who supply kiwifruit to Zespri and people who own shares in Zespri.
“A significant number of New Zealand kiwifruit orchard owners do not own Zespri shares and over 18 million shares are held by people who have left the kiwifruit industry,” he said.
The vote comes after shareholders in 2015 approved plans to strengthen grower control amid concerns about an increasing misalignment between producers and shareholders.
The changes required an amendment to the Kiwifruit Export Regulations last year.
Of Zespri’s 120.7 million shares on issue, some 18.1 million are held by people no longer connected with the kiwifruit industry and a further 29 per cent are held by producers at a ratio of below one share per tray, which Zespri deems “under-shared”.
At the other end of the spectrum, 8 per cent are held by producers at a ratio of more than four shares per tray, known as “over-shared”.
Zespri wants to aim for a ratio of one share for one tray produced but the new cap would set the limit at four shares per tray.
Voting entitlements would be set at the lesser of one voting share per tray or the total number of shares the producer holds.
Another resolution addressed the misalignment of shares by giving Zespri the right to issue, buy back and distribute shares.
Zespri shares last traded at $7.70 on the Unlisted platform, giving the company a market capitalisation of about $930 million. They began trading on Unlisted in early 2016 and have soared 340 per cent since then.
— BusinessDesk