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IT is all systems go for a new dispensation at KWV, after KWV Co-operative members gave an overwhelming majority of 85% for implementation of restructuring of the Group at a special member meeting in Worcester on Tuesday.
The restructuring proposal that was approved at the Annual General Meeting of KVW Group last week will be implemented in January.
This will result in KWV splitting into a company and a co-operative (Wijngaard). These two entities will each fulfil separate roles.
Lourens Jonker, KWV Chairman, hailed the restructuring as a breakthrough for producers and shareholders: "With the right structure we can now, as producers and as a company, tackle the global market in a more focused manner."
Jonker believes that for the South African wine industry to be a formidable global player, a continued focus on quality and competitiveness is required.
Jonker will also step down as chairman and board member of the producer co-operative and will in future only be involved with the company, KWV Limited.
Danie de Wet, vice chairman of KWV, thanked Jonker for his contribution to the industry over the past twenty years: "KWV transformed under Lourens Jonker's leadership and successfully embraced the South African realities and free market competition."
Both Jonker and De Wet are confident that restructuring is the right decision for securing the future for the South African wine industry, the wine producers and the shareholders.
The board believes that the decision serves the best interests of all parties.
"A lively debate and numerous meetings demonstrated the seriousness with which we viewed the restructuring. Hence, we are satisfied that we have an unequivocal mandate for the restructuring," said Lourens Jonker.
KWV announced the proposed restructuring in June and has since, in efforts to finalise the proposal, consulted widely with shareholders and members.
"The KWV ship is now in a better position than ever before to navigate the stormy waters of international competition."
In terms of the restructuring proposal, members of the KWV Co-operative convert 1,6 billion voting shares, which have no investment value, into 10% of the issued share capital of KWV Limited.
This interest will be held by Wijngaard Co-operative, which will thus acquire a 10% interest in KWV Limited. KWV Limited will then become a company focusing only on the commercial market.
It also means that KWV Limited shareholders, who currently own the 390 million shares with investment value, will obtain full control over KWV Limited.
The effect of these steps is that the A-shareholders benefit by the lesser dilution of the shareholding, but that young and future farmers will still have an interest in KWV through Wijngaard Co-operative.
KWV Limited will buy services to the value of R8 million a year from Wijngaard for a guaranteed period of five years.
Wijngaard represents the entire producer group at the newly established SA Wine & Brandy Company (SAWBC) and will provide services to the industry not provided by SAWBC.
* KWV reported positive financial results last week and expects even better results next year, with an increase in the demand for brandy, wine spirits and grape concentrate.
Sales of trademark wines increased by 20% and KWV plans to diversify sales to concentrate on the USA instead of Britain
Last week's meeting also elected a new board of directors for the company, including eight members of the current board.
The members are farmers Johan Carinus, Danie de Wet, Chris du Toit, Willie Hewett, Pieter Hugo, Lourens Jonker, Phillip Retief as well as Danie Cronjé (Absa), Franklin Sonn (Africa Group) and Christo Wiese (Pepkor). |