Affco directors dodge fight over fee increase

By PHILIPPA STEVENSON

Directors of meat processor Affco have decided not to seek a fee rise this year in a surprise fallout from the David and Goliath victory of small Con-tact Energy shareholder David Zwartz.

At the electricity company's annual meeting last month, Mr Zwartz successfully challenged a proposed 109 per cent fee rise for its directors.

But at Affco's annual meeting in Auckland yesterday, a motion to raise directors' fees a more modest 22 per cent was withdrawn before it could trigger the Zwartz effect.

Chairman Sam Lewis withdrew motion three without stating what it was, offering only a brief explanation when queried by a shareholder.

"It was defective and was withdrawn," he said before continuing the meeting. Later, Mr Lewis said that after the Contact challenge, the motion was studied and found wanting. "It was a Contact-type problem."

As Mr Zwartz showed, Contact's problem was that it sought to double directors' fees to $465,000 with a motion that contravened the company's constitution by making no mention of the previous amount approved by shareholders, or the amount of the proposed rise.

Affco's motion read much the same way, seeking to increase fees to $350,000 without specifying the existing fees or the amount of the rise.

Affco directors earn moderate sums compared with Contact directors, taking home a total of $287,528 last year.

Mr Lewis' fee was just over $63,000 while Contact chairman Phil Pryke would have been paid $120,000 if Contact's increase had been approved.