Friday, March 29, 2024

Former Fonterra boss Craig Norgate dies

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INAUGURAL Fonterra chief executive Craig Norgate, who had a major involvement in many agribusiness ventures, has died in London aged 50.
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Norgate, an accountant who was born in Hawera on April 14 1965, led Fonterra’s staff when it was formed from the merger of Kiwi Co-operative Dairies, NZ Cooperative Dairy Co and the NZ Dairy Board in 2001.

After leading Kiwi Norgate, a Massey University graduate, ran Fonterra for two years then teamed up with the McConnon family to form Rural Portfolio Investments, which acquired a controlling stake in rural services group Wrightson, merging it with Pyne Gould Guinness in 2005 to form PGG Wrightson.

He was instrumental in the creation of NZ Farming Systems Uruguay which aimed to repeat Fonterra's success by developing dairy farms in South America using New Zealand farming techniques.

His grand vision faltered in 2008 when Wrightson was caught by the credit squeeze from the global financial crisis in 2008 and was unable to settle an unconditional offer to buy a half stake in Silver Fern Farms for NZ$220 million.

Most recently he had responsibility for overseeing the merger of Chartered Accountants Australia with its New Zealand counterpart. He didn't front for the current lawsuit taken against the accounting body by rival CPA Australia.

His attempt to drive changes in the meat industry coincided with the advent of the global financial crisis and resulted in significant losses both for PGG Wrightson and his own private equity company.

Norgate had 15 years experience as a leader in the New Zealand dairy industry.

He became general manager of Kiwi Co-operative Dairies in 1991 and chief executive at the age of 29 in 1994.

In his time at the helm Kiwi grew from a turnover of $285m to $4.4 billion.

In 1996 Kiwi took control of Mainland Products with a 66% share and lifted that share to 83% in a merger with Otago Co-op in 1998.

He was NZ's first chief executive on a million dollar salary.

Norgate's two-year contract with Fonterra was not renewed in 2003 and a few weeks later in August he and the McConnon family formed Rural Portfolio Investments (RPI), with Norgate as managing director.

Norgate was to receive a $500,000 a year management fee, plus expenses, for five years.

In September 2003, RPI bid for shares in Wrightson and built their stake up to 50.01% following a hostile takeover in 2004.

Wrightson took over the number three player Williams and Kettle a few months later then merged with Pyne Gould Guinness in 2005 to form PGG Wrightson with RPI's stake at 30%.

Norgate became deputy chairman of PGG Wrightson in 2006, shortly after it had established NZ Farming Systems Uruguay and became chairman in 200.

In June 2008 PGG Wrightson made an unconditional offer to buy half of Silver Fern Farms for $220m but in September was unable to complete the equity raising required to finance the offer and defaulted.

It had to pay $42m in compensation to Silver Fern and wrote off $50m for the compensation and due diligence costs.

Norgate resigned as chairman of PGG Wrightson in 2009. In 2010 Rural Portfolio Investments went into receivership.

Norgate was a director of Port Taranaki, Sealord Group, the Taranaki Rugby Union and chief executive of the Institute of Chartered Accountants.

Among his many former governance roles he was also the inaugural president of the NZ-United States Council.

He was married with three adult children. BusinessDesk and NZX Agri

 

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