Levy Money and Industry Assets

Meat & Wool chairman Mike Petersen said Wool Partners International – the new PGG Wrightson and Wool Grower Holdings venture – would not receive funding from wool grower levies, and that levy money was not exposed to any Wool Partners International debt.  

Mr Petersen also said of Wool Partners International that “It will stand on its own two feet.”

However, it is now understood that Wool Partners International has acquired Wools of New Zealand, including its Fernmark brand and some $2.4 million of grower levy money. 

The Wools of New Zealand purchase was completed behind closed doors, denying other industry players the chance to buy-in.  Some in the industry say a competitive tender process should have been followed, to ensure the sale price was set by the market. 

Now concern is being raised that Wool Partners International may have its eye on the reserves sitting in Wool Research of New Zealand (WRONZ) (estimated at $30 million) along with the interest on this money and the funds sitting in the old Wool Board accounts (estimated at $6 million).

While many in the industry insist the WRONZ and Wool Board money is safe, others promise a massive fight if there are moves to transfer those monies into Wool Partners International coffers.

The question, though, is whether Wool Partners International can launch successfully without additional funds.

The task of launching a new international wool company would be herculean in boom times. But launching at a time when the world is facing a worsening economic financial crisis borders on the foolhardy.

Highly experienced exporters right across the agricultural sector are battling to keep their heads above water. The odds of a new company with no track record like Wool Partners International succeeding would seem to be very low.