Norgate determined to hang in there

By Duncan Bridgeman

Friday 21st May 2004

Craig Norgate continued to throw stones at Wrightson this week as his investment company began a slow creep towards its target for control of the company.

And perhaps sensing difficulty, his Rural Portfolio Investments (RPI) has extended its offer period by a week to June 9. All other terms of the offer remain the same for now.

After describing an independent valuation of Wrightson as one that "defied gravity," the former dairyman turned his attention to the company's board.

"They crashed the company once and now they are doing it again," Norgate told a group of analysts and shareholders in Auckland this week.

"We believe we can achieve the same turnaround as that of the mid-1990s."

Wrightson has strongly opposed the partial takeover,

which would see RPI move to a controlling position through its offer of $1.50-a-share, urging its shareholders not to accept the offer.

The rural services firm is standing by an independent report, which valued the company's shares at between $1.61-1.86, despite initial errors in the report.

But Norgate and fellow RPI owner Baird McConnon are urging Wrightson shareholders to make up their own minds.

"This isn't a tech stock, it's an agribusiness company," Norgate said, adding that Wrightson should be less concerned about forming joint ventures and instead concentrate on getting its core business in order.

RPI has copped plenty of flack for not giving specific details of how it plans to "turn the company around" a point that is frustrating analysts and shareholders.

This week, Norgate gave at least some indication of what RPI will focus on. The fundamental change would be in customer service, he said, noting a general decline in client satisfaction around the country.

"There are a lot of frustrated Wrightson staff and many have left ... ultimately that has reflected in the performance of the company."

Asked about a timeframe, Norgate said it would require an aggressive three-year plan. "If you take five years, you die."

While RPI was angling for two seats on the Wrightson board it was not considering wholesale management changes if it got the opportunity.

This week RPI moved to a stake of just over 15% in Wrightson, up from the 13% it had when the offer was announced.

Norgate reiterated that if RPI failed in its bid, it would review its entire shareholding with a view to exiting but the former chief of Fonterra remained realistic about RPI's chances.

"Your first loss is always your best one."

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