Farmer-shareholders of Alliance Group have approved a deal that will see Irish processor Dawn Meats take a majority stake in the New Zealand co-op.
Dawn Meats will pay NZ$270m ($154.4m) in return for a 65% stake in the business. Alliance Group’s farmer-members will retain a 35% shareholding.
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A total of 2,675 shareholders voted, representing more than 88% of the company’s issued shares. Over 87% of the votes were in favour of the proposal.
In August, Dawn Meats said it was seeking to take a 65% stake in the meat co-operative for NZ$250m.
However, last week, the company sweetened its proposed bid under a previously agreed adjustment mechanism.
Under a proviso that Alliance Group meet its full-year profit and debt targets, it was agreed Dawn Meats would pay an additional NZ$20-25m.
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By GlobalDataMark Wynne, chair of Alliance Group, said: “This investment strengthens our financial position, enhances operational capability and ensures continued farmer ownership.”
The company said the funds will be used to reduce debt, “accelerate” capital programmes and carry out future distributions to farmer-shareholders.
Niall Browne, the CEO of Dawn Meats, said: “By bringing together our complementary strengths, we’ll create a globally competitive business with enduring benefits for farmers, customers and consumers.”
Around NZ$200m of the proceeds is earmarked to repay Alliance’s short-term working capital facility, with the remainder to accelerate the board’s capital expenditure programme.
Farmer-shareholders will receive distributions of up to NZ$20m in the current and next financial years.
Alliance Group, which has about 4,300 shareholders, generated revenue of NZ$1.8bn in 2024 but reported a loss after tax of NZ$95.8m.
In a December statement following Alliance Group’s annual general meeting, the co-op said it had “turned a corner on a challenging two years following a comprehensive re-set over the past 18 months and is forecasting a return to profitability”.
Wynne added at the time: “Alliance has taken decisive steps to re-set the business and position the company for future success after a tough period for the global red meat sector, in particular for lamb, our largest product group.”
