Forum Archive Index - September 2001

["tennyson@caverock.net.nz" <tennyson@caverock.net.nz>]

>Snoopy wrote:
>
Roy McCallum wrote:,
>
>
> The RD1 www.rd1.com
> and Fencepost www.fencepost.com operations are serious businesses
> selling to the same target market as Wrightson etc but without
> livestock stock and wool services. Although both are attempting an
> entry into livestock transactions via a web service. The major
> strength they have in dealing with dairy farmers is payments are
> made by direct deduction from milk payments - no bad debts and
> prompt payment 20th month following. Yes the names are a little
> perverse.
>
>
Isn't that bad for farmers?   By that I mean, wouldn't they be better 
capital managers if they were to go to a retailer (like an 
independent Wrightson) that was able to offer them more credit?
> 
> 
> 
> Fronterra only have 20% of WRI.  Not really enough to *demand* the
> shots, even if they are the largest shareholder.  
> 
> That's the interesting bit - is 20% a starting base for building a
> platform for increased influence? Or is it just a silly adventure?
> What are the potentials for RD1 to buy a greater share of WRI and at
> what price?
> 
>
 
As I see it, with the new takeover laws , the *only* way forward for 
RD1.com from here is to make a bid for *all* of the remaining 
Wrightson shares.   Maybe they could wait for a business downturn and 
make a low bid so that not all shareholders accept?  Or maybe that 
could "do a Lion Nathan" and make a two tier bid such that it is 
attractive for shareholders to sell some of their shares, but not 
all.

>
> 
>>I notice that there are two new directors being nominated for
>>Wrightson at the AGM. 'Henry William van der Heyden' and 'Philip
>>Michael Smith'. 
> 
>Both are directors of NZ Dairy I believe. Van der Hayden was one
>time chairman of NZ Dairy and is now a director of Fronterra. 
>Michael Smith was once Chairman of Lion Nathan's China subsidiaries 
>and now a director of Fronterra, also AIA. 
>
>

So there is *still* no-one on the board with any retailing 
experience. Even Dr Freeth is a merchant banker by training.  
Absolutely amazing!   It looks to me like the change of guard from 
GPG to RD1.com was simply a change of hijackers.

>
>
>It appears I may have introduced you fellows to the secret part of
>NZ's economy - that based on the cooperative dairy industry - it has
>capital and is bent on expansion both locally and internationally. 
> 
>


Interestingly, when the options for a hypothetical, at that 
time, a hypothetical "Global Co" were being discussed one of the 
options was a partial pubic float to gain new capital.  One of the 
prominant economists, (was it Gareth Morgan?), suggested that as a 
co-operative Global Co. would be *short* of capital for what it would 
need to do in the future. 

Maybe part of the Global Co./ RD1.com strategy is to gain some of the 
future expansion capital needed from other farmers via profitable 
retailers like Wrightson? 

>
>
> How can non dairy farmer investors get a benefit from that?!
> 
>
 
Indeed, if dairying now makes up our largest single class of exports, 
it is poor that the nz investor has such a difficult time getting a 
piece of the action.  SNOOPY




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