October 15, 2025 • 6 mins
The Alliance Group chairman ahead of Monday’s big vote on the Dawn Meats deal. Will farmer voting apathy be his biggest challenge to get this past the goal posts?
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Episode Transcript
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Speaker 1 (00:00):
That is the big story at the moment in the
meat industry. Will or won't the Alliance Group be sold
to Irish company Dawn Meats. The chair is Mark One,
of course, former chief executive of Balance a Grand trans Mark.
You've got a lot on your plate trying to get
this deal past the goalie. I've been out of the country,
so I'm not up to speed on this, but I
(00:20):
put it to you your biggest enemy in this process
may be apathy.
Speaker 2 (00:27):
Yeah, hi, Jamie, that's exactly right. Epathy is the big
challenge for us simply to get a change that is proposed.
There are a very very high There's two hurdles and
they're both very very high. So we need more than
fifty percent of all shares on a shoe too both yes.
(00:48):
That's the first hurdle, So we've got one hundred and
six million shares on issue, so that's fifty three million
yes boats. And then there's a second hurdle that says, okay,
forgetting those people that now don't vote, we count up
the yes votes and versus the no votes, and the
yeses must be seventy five percent or more of the total.
(01:10):
So those are two very high hurdles, which makes sense,
it's set by the takeover panels under New Zealand law.
But this is a significant change for shareholders, so very
high hurdles.
Speaker 1 (01:19):
Now, I note that Dawn Meets will stump up with
an extra twenty to twenty five million dollars for its
sixty five percent stake in the Alliance Group. It had
agreed to pay two hundred and fifty million, So this
is going to be on top of that. Is this
kind of mark when an eleventh hour sweetener from you guys, No,
it's it's not.
Speaker 2 (01:40):
Actually, it's all been very very transparent and highlighted deeply
all the details in the Northington Report, the Independent Devisors
Report for shareholders. So what happens is that we had
to strike a price for the shareholding as part of
our negotiation in late June early July. But as everyone knows, July, August, September,
(02:01):
which is the last quarter of our fiscol year in
the winter months is very very volatile. So we set
up a mechanism that said, look, if we underperform, then
Alliance will over a period of time, have to pay
back some money to Dawn. And that's all in the mechanism,
(02:21):
and if we over deliver, then Dawn will have to
pay more money to Alliance shareholders. And so we're pleased
to announce that we announced our profit range. We still
got the auditors all over us at the moment, but
our profit range is between eighteen and twenty four million,
and that's over and above the forecast we had landed
with Dawn, and so under the mechanism, the auditors are
(02:45):
all going through it at the moment, but Dawn will
make a further contribution between twenty and twenty five million,
and the exact number we finalize the next week or
so two weeks. Because we over delivered the EBIT target
that we had collectively agreed.
Speaker 1 (03:01):
Well, I guess that's a good outcome. Well, that is
a good news story. You've got a group of high
powered farmers who are wanting to recapitalize the Alliance group themselves.
I'm not sure that that enthusiasm is shared by all
Alliance suppliers.
Speaker 2 (03:17):
No, it's look it's not. And we saw that last
year when we did our capital rays off Kelchik deductions,
and admittedly that was a terrible time of the year,
but farmers boted with their feet and took their livestock
to other processes. So that was the first signal. The
second signal is in April this year, we got Craig's
Investment Partners to do a survey across roughly thirty five
(03:40):
percent of the shares on issue and just get a sentiment,
and it was almost unanimous that farmers have no appetite
to put more capital into Alliance. They get a better
return investing that capital on farm and these days they
also have processor choice. So it was the second one.
And the last data point for US is we've just
(04:00):
completed twenty two roto meetings across the country and that's
probably around one thousand shareholders have turned up, those that support,
those that don't support, and those that are just still undecided.
And I would say reading the room is quite difficult,
but I would say ninety to ninety five percent have
(04:23):
indicated absolutely no appetite to put one.
Speaker 1 (04:26):
Okay, let's just quickly finish on the mechanics of this vote.
How many farmers have already voted, because we're going to announce.
You've got a special meeting and in the cargo on Monday.
I think you announced the result on Tuesday. How many
farmers have voted already.
Speaker 2 (04:41):
So we've got a vote of just over twelve hundred
out of our four thy three hundred shareholders. But this
is more about shares voting, so one share is one
vote and so on. On shares. We've got one hundred
and six million shares and at the moment we've had
about sixty five million shares vote. Obviously, we don't know
(05:02):
whether they're voted use or no. We'll find out. We'll
find out on Tuesday next week after the special General meeting.
But you know, our key request is to all shareholders,
please vote. It's your company, it's your decision. But yeah,
well vote is out a bad outcome, Okay.
Speaker 1 (05:19):
I just want to finish on that no vote. If
there is a no vote or apathy takes over, you
don't get enough votes to get past the threshold, will
the banks call in their outstanding debts? When's that going
to happen?
Speaker 2 (05:30):
Well, I would say the very the very next day
after the announcement. If it is a no vote, we'll
be back up in front of the banking syndicate with
a please explain no doubt they'll still call their one
hundred and eighty eight million overdue debt which is due
on the nineteenth of December, and then we go into
completely uncharted territory were we'll find ugly.
Speaker 1 (05:53):
We will follow this one with great interest. In fact,
I'm hoping to get a hold of Mark Gundam, one
of those large Farmer shareholders, get their side of the
story up next, Mark One. Thanks for your time. We'll
eagerly awake next week's final vote fall good.
Speaker 2 (06:06):
Thanks Jamie
That is the big story at the moment in the
meat industry. Will or won't the Alliance Group be sold
to Irish company Dawn Meats. The chair is Mark One,
of course, former chief executive of Balance a Grand trans Mark.
You've got a lot on your plate trying to get
this deal past the goalie. I've been out of the country,
so I'm not up to speed on this, but I
(00:20):
put it to you your biggest enemy in this process
may be apathy.
Speaker 2 (00:27):
Yeah, hi, Jamie, that's exactly right. Epathy is the big
challenge for us simply to get a change that is proposed.
There are a very very high There's two hurdles and
they're both very very high. So we need more than
fifty percent of all shares on a shoe too both yes.
(00:48):
That's the first hurdle, So we've got one hundred and
six million shares on issue, so that's fifty three million
yes boats. And then there's a second hurdle that says, okay,
forgetting those people that now don't vote, we count up
the yes votes and versus the no votes, and the
yeses must be seventy five percent or more of the total.
(01:10):
So those are two very high hurdles, which makes sense,
it's set by the takeover panels under New Zealand law.
But this is a significant change for shareholders, so very
high hurdles.
Speaker 1 (01:19):
Now, I note that Dawn Meets will stump up with
an extra twenty to twenty five million dollars for its
sixty five percent stake in the Alliance Group. It had
agreed to pay two hundred and fifty million, So this
is going to be on top of that. Is this
kind of mark when an eleventh hour sweetener from you guys, No,
it's it's not.
Speaker 2 (01:40):
Actually, it's all been very very transparent and highlighted deeply
all the details in the Northington Report, the Independent Devisors
Report for shareholders. So what happens is that we had
to strike a price for the shareholding as part of
our negotiation in late June early July. But as everyone knows, July, August, September,
(02:01):
which is the last quarter of our fiscol year in
the winter months is very very volatile. So we set
up a mechanism that said, look, if we underperform, then
Alliance will over a period of time, have to pay
back some money to Dawn. And that's all in the mechanism,
(02:21):
and if we over deliver, then Dawn will have to
pay more money to Alliance shareholders. And so we're pleased
to announce that we announced our profit range. We still
got the auditors all over us at the moment, but
our profit range is between eighteen and twenty four million,
and that's over and above the forecast we had landed
with Dawn, and so under the mechanism, the auditors are
(02:45):
all going through it at the moment, but Dawn will
make a further contribution between twenty and twenty five million,
and the exact number we finalize the next week or
so two weeks. Because we over delivered the EBIT target
that we had collectively agreed.
Speaker 1 (03:01):
Well, I guess that's a good outcome. Well, that is
a good news story. You've got a group of high
powered farmers who are wanting to recapitalize the Alliance group themselves.
I'm not sure that that enthusiasm is shared by all
Alliance suppliers.
Speaker 2 (03:17):
No, it's look it's not. And we saw that last
year when we did our capital rays off Kelchik deductions,
and admittedly that was a terrible time of the year,
but farmers boted with their feet and took their livestock
to other processes. So that was the first signal. The
second signal is in April this year, we got Craig's
Investment Partners to do a survey across roughly thirty five
(03:40):
percent of the shares on issue and just get a sentiment,
and it was almost unanimous that farmers have no appetite
to put more capital into Alliance. They get a better
return investing that capital on farm and these days they
also have processor choice. So it was the second one.
And the last data point for US is we've just
(04:00):
completed twenty two roto meetings across the country and that's
probably around one thousand shareholders have turned up, those that support,
those that don't support, and those that are just still undecided.
And I would say reading the room is quite difficult,
but I would say ninety to ninety five percent have
(04:23):
indicated absolutely no appetite to put one.
Speaker 1 (04:26):
Okay, let's just quickly finish on the mechanics of this vote.
How many farmers have already voted, because we're going to announce.
You've got a special meeting and in the cargo on Monday.
I think you announced the result on Tuesday. How many
farmers have voted already.
Speaker 2 (04:41):
So we've got a vote of just over twelve hundred
out of our four thy three hundred shareholders. But this
is more about shares voting, so one share is one
vote and so on. On shares. We've got one hundred
and six million shares and at the moment we've had
about sixty five million shares vote. Obviously, we don't know
(05:02):
whether they're voted use or no. We'll find out. We'll
find out on Tuesday next week after the special General meeting.
But you know, our key request is to all shareholders,
please vote. It's your company, it's your decision. But yeah,
well vote is out a bad outcome, Okay.
Speaker 1 (05:19):
I just want to finish on that no vote. If
there is a no vote or apathy takes over, you
don't get enough votes to get past the threshold, will
the banks call in their outstanding debts? When's that going
to happen?
Speaker 2 (05:30):
Well, I would say the very the very next day
after the announcement. If it is a no vote, we'll
be back up in front of the banking syndicate with
a please explain no doubt they'll still call their one
hundred and eighty eight million overdue debt which is due
on the nineteenth of December, and then we go into
completely uncharted territory were we'll find ugly.
Speaker 1 (05:53):
We will follow this one with great interest. In fact,
I'm hoping to get a hold of Mark Gundam, one
of those large Farmer shareholders, get their side of the
story up next, Mark One. Thanks for your time. We'll
eagerly awake next week's final vote fall good.
Speaker 2 (06:06):
Thanks Jamie
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