Westland shareholders voted overwhelmingly in favour of accepting the $588 million offer to sell the 150-year-old co-op to Yili at a meeting in Greymouth on Thursday.
The Hongkong Jingang Trade Holding Co (Jingang), a wholly owned subsidiary of Inner Mongolia Yili Industrial Group, offered shareholders $3.41 a share, translating to about $500,000 for an average-sized Westland supply farm.
More than 93% of votes cast were in support of the deal. Just 6% of votes went against the proposal.
“It’s good and it’s bad. At the end of the day 400 farmers from Karamea to south Westland, like any other business, had to vote the best for their businesses.
“Farmers had a fantastic co-operative for 82 years. They resisted Fonterra and it was a great model with great opportunity but sadly the directors went out and got too much debt and ended in big, big trouble this past two years,” Kokshoorn said.
“I feel for farmers as for most this vote was not their first choice but a sensible option after all other options were taken away from them with the debt taken on by the directors.
“There will be a lot of relief in this vote for farmers but very sad and sad for the people of the West Coast.”
Kokshoorn said he’s a great believer the man with the gold makes the rules.
“We have lost that gold and one thing for certain is we have lost the control. We just have to sit back and see where we go now with this new company.”
Kokshoorn’s worst fear is operations will move across the divide.
“We have the milk factory well established at Hokitika but at some point I expect we will see administration sneaking away to the east coast (Canterbury) where they (Yili) already have other processing interests.
“There’s no guarantees after 10 years and when you don’t have the rights to make the decisions you become very vulnerable to market forces.
‘”At the end of the day it’s business in a vicious circle and a decision farmers made with a heavy heart and a long-held company has slipped away from West Coast ownership,” Kokshoorn said.
West Coast-Tasman MP Damien O’Connor said it’s a sad day for the region.
“I am very disappointed,” O’Connor said after the vote.
“Something has gone seriously wrong.”
Development West Coast chairwoman Renee Rooney acknowledged it’s been tough for West Coast farmers.
“Westland’s owners voted in a direction they believe their co-op should head and we must respect that.
“Generally, the primary sector is the backbone of any rural region and if farmers are doing okay then the positive effect rubs off on the wider economic and social wellbeing of the community.
“Farmers made their decision and we move on,” Rooney said.
Westport dairy farmer Johno O’Connor voted against the sale to Yili.
“But I didn’t have many friends and that’s not surprising as there was no option.
“The company has let us down – farmers and their heritage down.”
O’Connor said the outcome was based on a flawed, rushed and very opaque process.
“While we are a minority of shareholders who voted no in what has been a whirlwind voting process, we believe there are a number of Westland shareholders who would not have voted yes had there been other options on the table.
The board cited confidentiality agreements for not disclosing other interested parties.
“But given we are the owners of the co-operative we should know where the other interests came from and what models they put on the table.
“I will be taking a close look at my farming system. Just because we are getting a competitive farmgate milk price for 10 years there’s no certainty farming will be sweet after that,” O’Connor said.
Westland chairman Pete Morrison said all Westland farming families need a competitive milk payout.
While Westland will cease to be a co-operative, the board believes the proposed transaction represents the best available outcome for shareholders,” Morrison said.
Morrison expects the sale to be complete by August 1.
