KEY POINTS:
Former Telecom chief executive Theresa Gattung, once one of New Zealand's highest paid executives, is back in business.
Just a year after departing as chief executive of our biggest listed company Telecom, Gattung has been appointed to chair a new wool company set up by farmers and rural services company PGG Wrightson.
The Wool Company has bought Wrightson's "strong wool" business for $37.5 million - less than the initially-announced sale price of $46 million.
Gattung formerly earned nearly $3 million a year running Telecom, but her payout last year of more than $5 million had $1.8m in "special payments", including a $550,000 restraint of trade deal to stop her going back into the telecommunications field.
Directors of the new company include PGG Wrightson chairman Craig Norgate, whose business has a 40 per cent stake in The Wool Company, Aorangi Laboratories executive director Alan McConnon, Bendigo Station owner John Perriam of Central Otago, and former investment banker Keith Sutton.
The board was announced by James Aitken, chairman of the Wool Company's majority shareholder, Wool Grower Holdings.
He said Gattung's experience and passion made a clear statement about the intention of the founding partners of the company.
"The concept of creating an internationally branded New Zealand wool product, reflecting the values sought by buyers of premium quality wool carpets and textiles is exciting interest across the wider wool industry and will deliver significant value for wool growers and the nation," Gattung said.
"We want to establish a strong New Zealand wool brand and partner internationally with recognised players".
The business will start operating tomorrow in its efforts to improve industry returns and ensure sustainability of wool production.
The farmers behind the business have called for strategic change in the industry, including consolidation of the wool clip, unification of woolgrowers, collaboration with industry, and innovation in the market.
The company will operate as a subsidiary of Wool Grower Holdings, which will offer shares to farmers later in the year and register as a grower-owned cooperative with a 60 per cent voting interest and a 50 per cent equity interest in The Wool Company.
Wool Grower Holdings is borrowing $10 million from Wrightson to buy an initial stake in The Wool Company, which is itself paying Wrightson with $10m ordinary shares, plus convertible preference shares ($17.5m) and cash ($10m).
As Wool Grower Holdings invests further capital the preference shares owned by Wrightson will be converted to ordinary capital.
- NZPA
