Is Westland Milk one of NZ’s “key strategic assets”?
NZ First is adamant it is and believes the government should be a applying a “national interest test” to the proposed sale of the company to the Chinese dairy giant Yili.
Those who see heavily indebted companies like Westland Milk struggling to make a profit and not even matching Fonterra’s payout to its suppliers might take a cooler view to the proposed sale.
Federated Farmers dairy chairman Chris Lewis said he had received “mixed” feedback from West Coast farmers on the deal, which will require 75% approval. Continue reading “NZ First is not alone in worrying at the implications of a Westland Milk sale to Yili”
The PM, Jacinda Ardern, received what her handlers would have perceived as unexpected criticism from the media after she gave a pre-budget speech to an Auckland business audience. One of those in the audience was said to have described it as an “ideological fairytale”; others apparently were disappointed it had “nothing for business”.
Given she did list as two of the five priorities in the budget as being “creating opportunities for productive businesses, regions, iwi and others to transition to a sustainable and low-emissions economy; and supporting a thriving nation in the digital age through innovation, social and economic opportunities”, the criticism itself could be regarded as a bit “ideological”.
Surely business doesn’t expect government hand-outs, even if it is labeled a “well-being” budget?
But there seems little doubt that the mood of business is downhearted these days.
Or is it really? Continue reading “Businesses seem gloomy but health-sector companies are in good heart”
NZ co-ops have been getting a bad media rap lately. Take Fonterra, for example. Andrea Fox, one of the country’s best-informed journalists specialising in agriculture issues, started a new series in the NZ Herald with the headline: “Fonterra: Disappointment and soured dairy dreams”.
Noting the dairy goliath had a silver-spoon birth nearly 18 years ago she wrote:
“Today the co-operative is looking a bit like the family’s overweight, lazy teenager hogging the remote on the biggest couch in the room And the credit card bills are coming in”.
After Fonterra posted a historic first net loss of $196m, Fox says calls are heating up for the company to be split up and a company, perhaps listed, spun off it, open to outside capital investment to chase high-value product markets. Continue reading “Fonterra could learn lessons in enterprise and growth from Australia’s Wesfarmers”
On the face of it, it’s a no-brainer. Weighed down with debt, Westland Milk, based in Hokitika is financially on its knees. Riding to its rescue, Chinese dairy giant Yili has come in with a $588m buyout deal which will yield $3.41 a share to the co-op’s farmer shareholders, and, as well, absorb Westland’s debt and liabilities.
According to Westland, the nominal value of its shares has ranged from 70c to $1.50 per share. For the average-sized Westland farm, the share offer translates to about half a million dollars cash.
The offer looks even more attractive since Westland had to cut its milk payout forecast, while other companies’ forecasts are rising. Westland, which has grown out of the West Coast’s 150-year dairy heritage, hasn’t paid a competitive milk price for several years.
The conditional deal comes with extra sweeteners. Yili has committed to collect all milk supply. It will also pay a competitive price of at least as much as the Fonterra farmgate milk price for 10 years.
But why would Yili go that distance? Continue reading “Yili bid for Westland Milk raises questions about dairy co-operatives – and Fonterra’s ownership”
Encouraging signs emerged this week that key elements in the structure of NZ’s largest export industry are whipping themselves back into the shape they should be.
The giant co-op Fonterra has gone back into the black with a net profit of $80 million in the first half, after previously recording a net loss of $186m.
Meanwhile Westland Milk Products, NZ’s second biggest dairy co-op, is in line to be sold to China’s biggest dairy company, Yili, in a $588m transaction that would inject nearly half a million dollars into the operations of each of its suppliers.
Alongside these co-ops, the Canterbury-based Synlait has underlined its strength in the industry with a solid result in its half-year after achieving higher sales volumes. It reported a half-year net profit of $37.3m, 9.6% lower than the $41.3m in the previous first half, but with the focus on investing for growth, with a second processing plant due to come on stream for the 2019-20 season. Continue reading “Comforting news for dairy farmers as companies report results and the world price rises again”
Hamilton’s Aerospace Ltd’s turboprop P-750 light utility aircraft has been developed into an unmanned aerial vehicle (UAV) in conjunction with a group of Chinese organisations for commercial and military applications.
The AT200 has been developed by Chinese company Star UAV with the Chinese Academy of Sciences’ Institute of Engineering Thermophysics and other Chinese state organisations.
Launch customer SF Express, a Chinese delivery services company based in Shenzhen, Guangdong, China, and the second largest courier in China will acquire three AT200 for testing and evaluation. Test flights have already begun.
SF Express provides domestic and international express delivery.
The plan is to use the aircraft for unmanned cargo flights. The AT200 will carry 1500 kg over ranges of up to 2000 km.
Attracting interest from agencies outside China is how SF Express would integrate the AT200 into its intensive network of logistical support for the Chinese Peoples’ Liberation Army, notably its new network of militarised islands in the disputed South China Sea.
Aerospace developed the P-750 from the legendary Fletcher Fu24 aerial topdressing machine. It is in widespread use around the world for tasks ranging from light freight to sky-diving.
The company says its extremely short capabilities put it in a class of its own.
It is certified in the US as well as NZ and is supported by major US firms including Pratt & Whitney, engine-makers.
In China where skydiving has taken off as a recreational activity, Aerospace’s P-750 is used extensively because of its ability to carry up to 17 skydivers to jump height fast and effortlessly and to return quickly to pick up more thrill-seekers.
Last year the company was taken to court and fined $74,000 for breaking UN sanctions by shipping parts to North Korea.
Move over Shane Jones – Grant Robertson might be keen to join you in assailing Air NZ for its appalling exercise in yield management at the weekend in jacking up round fares to Christchurch to $747 and $787.
It took a crisp call from Finance Minister Robertson, who holds Air NZ’s shares for the Crown, to boot common sense into the Auckland warriors who run the national carrier.
Fares were capped and compassionate fares made available.
Air NZ furthermore cancelled 17 regional services from Christchurch, saying, it was not possible to screen customers and their baggage.
But wait a minute. Those flights (on ATRs and Q300s) aren’t screened anyway.
So, there must have been another reason.
Perhaps the police wanted to prevent possible accomplices stealing away on non-screened flights. Continue reading “Air NZ’s response to Christchurch tragedy: regional flights were grounded while its fares soared …”