KEY POINTS:
A new wool company launched to reverse the ailing fortunes of the sector has been panned by the Wool Exporters Council.
Former Telecom chief executive Theresa Gattung was appointed this week to chair the Wool Company, which started operations yesterday.
Listed rural services business PGG Wrightson has agreed to combine wool operations with prospective co-operative Wool Grower Holdings.
Wool Exporters Council executive manager Nick Nicholson said the formation of the company involved little knowledge or experience in marketing wool.
"There is no support from any wool exporting company, no support from the wool broking or wool scouring sectors, private wool merchants don't want to know, New Zealand wool carpet manufacturers haven't shown any interest and there seems to be very little, if any, grower support," Nicholson said.
The council represents about 13 companies covering about 84 per cent of exported wool.
"Most of the comments by Ms Gattung at the launch of the company on Thursday were nothing short of appalling and her analogies with rugby were, at best, bizarre," he said.
The Wool Company has agreed to buy PGG Wrightson operations including brokering, procurement, warehousing, auction, marketing and exporting for $37.5 million - $10 million in cash, $10 million of ordinary shares and $17.5 million in convertible preference shares.
PGG Wrightson would initially have a 50 per cent equity stake in the new business and a 40 per cent voting right while Wool Grower Holdings would have 60 per cent. The company would be a subsidiary of Wool Grower Holdings and it was hoped otherindustry players would become involved.
"Certainly PGG Wrightson have got involved, but commentators up and down the country, not just in the wool industry, have been referring to the offloading of PGG Wrightson wool to the new company as the dealof the century," Nicholson said.
Wool Grower Holdings chairman James Aitken said the status quo was not an option.
"The reality is that we have growers leaving the industry through insufficient returns and we have exporters leaving the industry for the same reason," Aitken said.
"We simply must face facts and work collaboratively for meaningful change."
