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The total division of KWV Group and its service functions, through the foundation of a new co-operative producer body - provisionally named Wijngaard Co-operative - is in the best interests of all parties concerned. And the train of restructuring must go on. This was the unequivocal message at the Co-op's drawn-out annual general meeting, attended by about 400 producers who, by a show of hands, gave overwhelming support to the restructuring programme of the board of directors. There never was any doubt that there had to be an inherently healthy and vital producer organisation; the debate, lasting for an unprecedented three and a half hours, concerned the amount of shares to be transferred by the Group to Wijngaard Co-operative to pay for services rendered. If Wijngaard receives more than the 10% according to a compromise with the so-called "Group of Five", it will have more control and a stronger financial base. If it receives less, its viability and service activities will be restricted, but the holders of A-shares will benefit because the shares will not be watered down so much. This was the dilemma faced by all present in the jam-packed hall of the Paarl Toring Church - an old-fashioned, cool building, in which some of the speakers were occasionally fuming on this sunny, early summer's day. That the parting could eventually take place on a fairly calm note, with satisfaction that was apparently general, is probably due to the fact that ample time was allowed for debate after the conclusion of the normal official procedures. Also, misunderstandings were resolved and more mutual understanding created. One thing was clear, a large part of the problem stemmed from misunderstandings, misconceptions and mistrust. This, despite the far-reaching roadshow by the KWV board and management to address members in each corner of the outstretched wineland at two series of meetings that spanned almost two weeks, as well as discussions with individuals and groups. The broad geographical area and divergent interests served by KWV create unique communication problems - especially when the watershed is far-reaching and historical, as in the present case, where pliability and urgent communication are of the essence. Especially with the media going out of its way to flog this controversial horse. One of the most outspoken and emotional producers at the meeting, Danie Joubert of Wellington, architect of the so-called "Third Proposal" - which enjoyed considerable publicity in Die Burger - eventually admitted that he had not quite understood the setup and did not in fact have an intrinsic problem with restructuring. "We were confused by confusing information." His counter-proposal, which was not accepted, was that "the bus has to be stopped before we decide how the controlling vote is going to be given away". He insisted on an independent valuation of KWV's nett asset value - which, however, was made available in full at the meeting in the set of statements that had been accepted. A young farmer from Montagu, Karel du Toit, said in his seconding motion to the chairman's address that he would also very much like to see an interest of 15% of the A shareholding of the Group going to the Co-op. However, much as one might wish for the disappearance of the Group of Five, they are a reality. KWV's managing director, Dr Willem Barnard, said the only proposal on the table at that stage represented a compromise so that the transformation could indeed take place. "A large middle group has to be satisfied, otherwise we shall be even more divided in a year's time." Kobus Joubert, chairman of KWK, the umbrella body for about 60 'co-operative type' cellars, said if the process dragged on at this stage, it would have a snowball effect that they would be unable to stop, although they were actually in favour of 15% plus shares for Wijngaard. The risk of bigger division and more power in the hands of A shareholders, to the eventual detriment of Wijngaard, was an issue raised by various speakers. Pug Roux, a member of the Big Five, who recently acquired 15% of KWV Group's A shares, assured the meeting that their investment in vineyards was bigger than in KWV shares. "Ours was a loyal resistance at all times. We always took the interests of the company and the industry into account and immediately accepted the mechanism for protection against asset strippers. We are sensitive about being called 'asset strippers' or 'cheque book farmers'." In conclusion Dr Barnard appealed to the producers to support the restructuring proposals, "so that we do not lose momentum. We have 70% common interests. Right now the biggest mistake would be to stop the train. The purpose of the restructuring is to allow the company to surge ahead, backed by capital, and to establish a credible and sustainable producer organisation". KWV chairman Lourens Jonker said after the meeting: "The members of KWV Co-operative agreed with the board that the division of KWV into a company and a co-operative, each fulfilling separate roles with credibility, was the right move for the future of the South African wine industry, for wine producers and for shareholders. The board is of the opinion that the proposal on the table serves the best interests of all parties." The support for the proposal means that it will now be put forward for approval by the annual general meeting of KWV Group Limited on 27 November before members will vote on the matter at a special meeting of KWV Co-operative on 3 December 2002. Meanwhile there were indications at the Co-op's AGM that some of the groups who opposed the 'compromise' in the media, may submit some more proposals, which they are welcome to do if these proposals, where applicable, comply with the requirements of both the company act and the co-operative act- especially with regard to timely submission and the number of supporters required. Proposed amendments to the statute The following are the proposed amendments to the statute that will be put to the vote at a special members' meeting on 3 December:*
The Co-operative will kick off with a five year contract for the provision of services to the value of R8 million per annum, as well as shareholding that will provide a dividend and capital growth. In the process VinPro (SA) will disappear and its functions and most of its personnel will be assimilated into Wijngaard. *Status as on 31 October 2002. They say goodbye ... Lourens Jonker of Robertson has come to the end of his term as a director and has decided not to make himself available for re-election. He will remain a director and chairman, however, until the new dispensation has been formalised. Mr Jonker, owner of Weltevrede Estate, was elected as a director in 1981 and became chairman of the board in 1994. In this period he steered KWV as an inspiring and dynamic leader through important and critical phases, especially the transformation to a company in 1997 and the current restructuring. At the annual general meeting it was announced that leave would be taken of five retiring directors, who were thanked by the chairman as follows: Bertie van der Merwe of Worcester, who, for the time being, is getting off the wagon with one foot only! The proposed division of the Worcester district into two means that the election and inauguration of a new director for Wijngaard Co-operative may not take place until early next year. Bertie agreed to extend his term to bridge the few months. It is therefore foreseen that formal leave will be taken of him in February. Swepie le Roux. The director among the group who will surely go down in the annals as one of the most flamboyant and eccentric directors ever produced by KWV Co-operative, is Swepie. Of the current directors, he has also served longest. In August 1979 he was elected as the director of the Klein Karoo district, and has since served his producer members with great dedication. His singular sense of humour made him a much loved figure who will be sorely missed at board meetings." Since 1994 Chris du Toit has served on the board of KWV Co-operative, but has also been president of Agri SA and is presently chairman of the Agricultural Business Chamber and director of WP Co-operative. His vast exposure and experience made him a valuable member of the board in this phase of the development of KWV Co-operative. Johan Carinus, who has represented Stellenbosch district on the board of KWV Co-operative since 1990, has been - apart from his involvement with Stellenbosch Vineyards, the new Distell board and the University of Stellenbosch - a respected and inspiring voice among his fellow directors. Herman Bailey left deep footprints at the former Rural Foundation and with this background and knowledge of labour interests, also made a considerable contribution to the board of KWV Co-operative over the years. Johann Krige of Stellenbosch, whose term expired, was unanimously re-elected as director and Niel Nel was unanimously elected as the new director for the Klein Karoo. Mr Jonker also announced that Theo Pegel, executive director of VinPro (SA), would retire at the end of the year and that Jos le Roux of VinPro was the CEO-elect of Wijngaard. |
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