Fonterra farmers have voted to implement the Trading Among Farmers scheme, but failed to get the numbers required to approve a resolution that would protect farmer shareholders.
The Trading Among Farmers proposal met with 66.45 percent approval (only 50 percent was needed) at a vote yesterday, but a second resolution – to tighten limits on the size of the shareholders’ fund, and give farmer shareholders representation in setting the farmgate milk price – only met with 72.8 percent support, short of the 75 percent needed.
Fonterra will now put the second resolution to a second vote in November at its next annual meeting.
The moves would mark the biggest structural changes in Fonterra since its establishment in 2001, allowing farmers to sell the rights to the dividends on their shares. These rights would trade on the NZX as units in the fund.
The threshold of the fund would 20 percent of total shares.
Fonterra chairman Sir Henry van der Heyden said the final vote on the share trading scheme attracted a record voter turnout.
“We’ve spent six years talking about capital structure and it has been a rigorous debate and process. Our farmer shareholders have made a great contribution and the final version of Trading Among Farmers is all the richer because of that input," he said.
“We broke new ground with the formation of Fonterra and now we have the support from our farmer shareholders to refine that model and to break new ground again."
TAF won the support of the majority of the Shareholders’ Council after 19 "significant revisions”.
van der Heyden said the board was still working towards a November launch for TAF but this would be dependent on market conditions.