Fonterra
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| Type | Co-operative (NZX: FCGHA) |
|---|---|
| Founded | Auckland, New Zealand, 2001 |
| Headquarters | Auckland, New Zealand |
| Key people | Henry van der Heyden, Chairman Andrew Ferrier, CEO Guy Cowan, CFO |
| Industry | Manufacturing Retail (Department & Discount) |
| Products | Fonterra Ingredients Fonterra Brands Fonterra Enterprises Fonterra Milk Supply |
| Revenue | NZ$13 billion (2006) |
| Employees | 17,400+ |
| Website | www.fonterra.com |
Fonterra Co-operative Group Ltd (NZX: FCGHA), generally known as Fonterra, is New Zealand's largest company by turnover. A cooperative, Fonterra is owned by approximately 11,000 farmers throughout the country. It is the sixth-largest dairy company in the world, and the most influential by far when it comes to determining international dairy trade, handling over a third of all international dairy trade.[1]
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[edit] History
Fonterra was established in October 2001 through a merger of the two largest New Zealand dairy cooperatives and the New Zealand Dairy Board. The purpose of the merger was to create a single company to manage the supply chain for a significant proportion of the New Zealand dairy industry[citation needed].
The company has an annual turnover of around US$8 billion. Its core business consists of exporting dairy products under the NZMP brand (95% of its New Zealand production is exported). It also operates a fast-moving consumer goods business for dairy products, Fonterra Brands. Fonterra has a number of subsidiaries and joint-venture companies operating in markets around the world.
In November 2007 after a lengthy capital review the company's board recommended to farmers that its assets, liabilities and operations be split from the co-operative and listed on the New Zealand Stock Exchange. Under the plan, which had been rumoured for months, the co-operative would retain two-thirds of the company, 15% would be given to farmers (which they could sell or retain), and 20% traded freely. Doug Woolerton, a New Zealand First MP, branded the plan "a disaster for farmers and for our economy as a whole", but other commentators said it would breathe life into the sector and the New Zealand economy as a whole. The announcement started a two-year review. If the board's plans are adopted, Fonterra is expected to be New Zealand's largest listed company.[citation needed]
Fonterra have recently suggested that they will move their US headquarters from Harrisburg, Pennsylvania to Chicago, Illinois adjacent to the Chicago O'Hare International Airport for close proximity to a wide range of international flights, proximity to public transportation, their dairy suppliers and clients (Kraft Foods Inc. and General Mills Inc.)in the Midwest.[2]
[edit] Brands
[edit] Key Brands
[edit] Brands in New Zealand
- Anchor (milk)
- Anlene
- Tip Top and Kapiti (icecream)
- Country Goodness
- Yoghurt-2-Go, De Winkel, Fresh and Fruity, Metchnikoff, and Slimmers Choice (yoghurt)
- Anchor Calciyum
- Primo (flavoured milk)
- Mainland, Kapiti, Ferndale and Galaxy (cheese)
[edit] Brands in Australia
[edit] Business units and subsidiaries
- Fonterra Brands
Consumer goods business
- Fonterra Ingredients
- Fonterra Global Trade
Dairy ingredients supplier to the globally traded market
- Fonterra Foodservices
Hospitality supplies
- Fonterra Group Manufacturing
Fonterra's food processing and manufacturing operations
- Fonterra Milk Supply
Collect and Distribute milk from farms
- Shared Services
Finance, Communications, Human Resources, Strategy and Information Services.
- RD1 - a wholly owned rural retail supplier. RD1 was formed at the end of 2001 through the merger of RD1.com and the Town & Country Agri-centres, Fonterra's two rural supply companies. With revenue exceeding $440 million, RD1 is New Zealand's largest retailer of agricultural supplies to dairy farmers. It operates 51 stores throughout New Zealand.[citation needed]
[edit] Environmental performance
Fonterra has a number of initatives relating to environmental protection. Its environmental policy states that "Fonterra shall demonstrate a global commitment to protecting the environment. Sustainability, good environmental practice and environmental improvement are cornerstones of Fonterra’s environmental commitment."[6]
In 2003 Fonterra was a signatory to the Dairying and Clean Streams Accord, which sets a timeframe for the improvement of water quality on farms. In February 2008 the inaugural Fonterra Environmentalist of the Year was announced at the Beehive.[7]
In 2006 Fonterra was criticised for an application to discharge 8500 m3 of wastewater into the Manawatu River.[8]
[edit] Proposed changes to capital structure
In November of 2007 the board of directors announced [9] a two-year consultation programme regarding their preferred capital re-structuring option: putting the business operations in a separate listed company, with the co-operative maintaining a controlling interest. The aim was to give more access to funds for global growth.
Praised by some [10] [11] as a bold move which would allow better access to outside capital, the proposals encountered significant opposition from both farmer shareholders and the government (who would be required to pass enabling legislation). Despite including a range of safeguards, farmers were clearly concerned at the risk of losing control; in what was sometimes described as a demutualization.
The board responded in 2008 with a request for consultation and discussion. [12] [13]
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[edit] See also
[edit] References
- ^ Frequently Asked Questions (from the official company website. Accessed 2008-02-20.)
- ^ 'Northwest suburbs get 2 big leases', Chicago Real Estate Daily,(March 26, 2008) http://www.chicagorealestatedaily.com/cgi-bin/news.pl?id=28712 [accessed 1 April 2008]
- ^ Bonlac bid just start for Fonterra. The Sydney Morning Herald. Retrieved on 2008-04-05.
- ^ Farmers outraged at new milk price offer. Australian Broadcasting Corporation. Retrieved on 2008-04-05.
- ^ Name change for Murrumbidgee Dairy Products. Australian Broadcasting Corporation. Retrieved on 2008-04-05.
- ^ "Fonterra Environmental Group Policy", Fonterra, 2006-01-19. Retrieved on 2008-03-13.
- ^ "Fonterra backs green award", Rural News, 2008-03-11. Retrieved on 2008-03-13.
- ^ "Forest & Bird calls on Fonterra to clean up its act on the Manawatu River", Royal Forest and Bird Protection Society of New Zealand, 2006-08-09. Retrieved on 2008-03-13.
- ^ http://www.fonterra.com/wps/wcm/connect/fonterracom/fonterra.com/our+business/news/media+releases/fonterra_announces_start_of_capital_structure_consultation_programme
- ^ http://www.milfordasset.com/publications?objectId=5aa7ef38-81bd-4b93-8e05-a8edb1232a02
- ^ A bold step forward for Fonterra. Retrieved on 2008-05-19. “The global ambitions enunciated at its birth have not been translated into action. That may, however, be about to change if dairy farmers embrace the bold path outlined by Fonterra management”
- ^ Unco-operative: Taking a stand. Retrieved on 2008-05-18. “Mr van der Heyden said the board spent two years looking at a large number of options for capital restructure. And it remains firm in its view, that the plan put to farmers in November, is the best one.”
- ^ Co-operative Issues – Demutualisation. Retrieved on 2008-05-14. “The Fonterra board originally proposed a member vote in May 2008. This has now been set aside for now as not essential and because the Fonterra board says there a need for more consultation and discussion due to misunderstandings and some misinformation....Under the proposal a second company would be created with all the assets, liabilities and operations of the current co-operative shifting to this entity. Ultimately shares in the new company would be listed.”
