MPC already has a 37 per cent stake in the Bundaberg processor, and the acquisition will consolidate the Lismore-based co-operative as the largest macadamia processor in the world.
MPC is 100 per cent owned by around 180 macadamia growers in northern New South Wales and southern Queensland.
Larry McHugh, the chief executive officer of MPC, said that 35 growers attended the Ballina meeting to vote on the proposition to acquire the remaining PGM shares.
“The voting was essentially 99 per cent for all the resolutions and only one per cent against, so it was very favoured by the growers and the owners of MPC,” he said.
“The proxies were almost exactly the same, so there was hardly any against the motion and almost all the proxies were for.
“Some shareholders couldn’t vote on some of the resolutions so there were over one million votes on two of the resolutions and around 500,000 on each of the others.”
Each vote allowed is based on the number of the shares held with the MPC.
In 2018 MPC processed 12,900 tonnes of nut-in-shell and PGM was not too far behind with 11,500 tonnes.
“They’re very similar size and they’re number one and number two in Australia for the quantity they processor,” said Larry McHugh.
“There’s one in processor in South Africa who or may or may not be bigger than us at the moment, but this will take us to be comprehensively than any other processor in the world.”
Mr McHugh said there was no concern that the acquisition would lessen competition in the industry.
“As part of the process of doing this transaction we submitted to the ACCC, [we] answered a whole set of questions for them and they came back and said they weren’t going to hold a public inquiry about it,” he said.
“This point they’re satisfied, they always reserve the right to come back but essentially we’re just reflecting what we’ve been doing for the last few years working together and making the bond stronger.”
The transaction date for the acquisition is expected on April, 30.
He believes that the acquisition is not only good for MPC and PGM growers but the entire macadamia industry.
“This transaction is about creating a stable base so that our companies can stabilise prices around the world and help maintain the value of growers’ farms,” he said.
“Our size now allows us to have influence on the world market and that’s what we intend to do over the next five years as the crop grows, we intend to use our influence to try and make sure prices remain stable.”
The global production of macadamias is expected to double within the next five years.
Macadamia prices could lift for growers
MPC has released an opening price for its suppliers of $5.40 per kilogram nut-in-shell, up 20 cents on last year’s opening price.
“That’s up on our initial price of last year of $5.20, but the final price that MPC was $5.60 so it’s actually in between the start price and the end price,” he said.
“We issue a price at the beginning of the year and at the end of the year if we have profit in the companies then we do a profit distribution through the nut-in-shell price at the end of the year.
“There was quite a sizeable bonus to growers last year and we’re trying to get closer to what we believe our final price will be this year rather than having a major bonus at the end of the year.”
Mr McHugh said this year’s end price could be $5.60 or even higher.
“It’s too early to tell at the moment because it’s very early in the season and we haven’t really got a good handle on what the crop’s going to be or the sales for the year yet,” he said.
“But demand is strong, there’s some doubt about the crop in the Northern Rivers because of the long dry that went on in there but we’ll know over the next few months what the crop’s really like.”
Last year the Australian macadamia industry produced a record crop of 52,900 tonnes and growers are predicted to top that this year delivering an estimated 53,500 tonnes.