The AWB Limited (AWBL) Board has urged shareholders to support amendments to the Company’s constitution at a General Meeting on 21 August 2008 to ensure the Company can provide effective choice for wheat growers in a deregulated export market.
AWBL Chairman Brendan Stewart said that amendments to the current constitution were essential so that the Company can compete on a level playing field with Australian and multinational grain traders.
Mr Stewart said the proposed amendments were supported by an 88 per cent majority of all shareholders at the Annual General Meeting (“AGM”) in February however the company did not achieve the 75 per cent support from A class shareholders required for approval.
“The AGM vote occurred while the Single Desk arrangements were in place,” Mr Stewart said. “Now that the Single Desk arrangements have been replaced by a system of multiple accredited exporters, AWB must be able to compete on a level playing field with other grain traders if wheat growers are to have effective choice in the future.
“AWB wants to retain the mantle of Australia’s number one grain trader and remains committed to providing the best product and service offering to wheat growers under the new market conditions but we cannot do that with one arm tied behind our backs with an out-dated Constitution.
“As we have seen in the domestic market, in a competitive wheat export market, grower loyalty will only be won and retained by companies that offer wheat growers the best products, price, service and security of payment and only a fully competitive AWB will be able to do that.”
Mr Stewart said the proposed amendments will:
- remove restrictions on what AWB can do in future but leave in place a clause stating that the company remains committed to grain trading
- replace the dual class share structure with a single class of shares so that those who own the company and provide its capital also govern the company
- retain at least two Directors with agricultural experience on the new Board; and
- retain a 10 per cent ownership cap to ensure that shareholders can vote on any changes to ownership and control of the company.
A clear majority of AWBL Board Directors elected by both A and B class shareholders support the proposed amendments to the Company’s constitution and agree that the proposed amendments are in the interests of the Company as a whole.
However, four Directors elected by A Class shareholders do not support the proposed amendments to the constitution and, as required by the constitution, their opinions will be set out in the Notice of Meeting to be mailed to shareholders in the week commencing 14 July.
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