Clarity needed on shareholder resolution, says SFF

Silver Fern Farms logoSilver Fern Farms chief executive Dean Hamilton has clarified the process for Silver Fern Farms shareholders following the receipt on Thursday of proxies that shareholder Allan Richardson stated represent above five percent of the outstanding shares in the Company.

“Once we have had the opportunity to review the proxies, we will be communicating to all shareholders.” says Hamilton.

The company notes Richardson’s press release contains two misleading statements.

“First, the content of the proposed special meeting is incorrect in his statement,” says Hamilton. The resolution proposed by Richardson is:

“That the Silver Fern Farms Limited Board of Directors be required to provide all shareholders with a full analysis of the potential benefits and risks of Silver Fern Farms Limited and Alliance Group Limited merging into one cooperative entity, along with a comprehensive risk mitigation plan, verified by an independent firm.”

“However, in his press release Mr Richardson states; ‘The special meeting will give all shareholders the opportunity to review a full analysis of the options facing Silver Fern Farms’. That is not correct. If called, the meeting will discuss and vote on the resolution as framed.

“The meeting will not have any more information available to it to consider any analysis, risk plan and the like as the subject of the resolution is to decide if shareholders want the Board to undertake any further analysis and then provide that information to shareholders once completed.”

Under Silver Fern Farms’ constitution, if passed, the resolution would not be binding on the Board, says Hamilton.

“Only if the resolution is passed at the meeting and if the Board elects to act on it, would the Board then undertake and provide the further analysis sought, subject to the normal bounds of commercial confidentiality.

“Secondly, Mr Richardson makes the comment that; ‘clearly the board should have first investigated the potential gains of $100m/pa tabled in the Meat Industry Excellence (MIE) report, released in March 2015’. We refute this statement and consider it misleading.”

Hamilton says the company has reviewed in detail, and done so a number of times, the costs and benefits of industry consolidation, including those related to a potential merger with Alliance.

“A merger requires the willing participation of all affected parties. Silver Fern Farms has over time had discussions with various parties concerning merger which have been inconclusive. While the costs and benefits of potential rationalisation opportunities can be, and have been, estimated, if the opportunities remain unconsummated then the analysis is moot. Whilst the company was not involved with the MIE report, the Board did of course review it when it became public and found that there was little in the way of new information not previously available to the Board of Silver Fern Farms.”

Hamilton says Silver Fern Farms has discussed this topic with shareholders in many forums including at supplier meetings and at the AGM.

“We look forward to the opportunity to discuss these matters of interest further with our shareholders.”

Supplied by Silver Fern Farms.

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