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Dairy Industry Changes Require Careful Planning

Wed, May 16, 2012 No Comments by tomwake

It is the end of the milking season and gypsy day is close. For some farm owners and sharemilkers the new season will mean new sharemilking arrangements. These agreements will be negotiated in the shadow of the continuing restructure of Fonterra and the proposed share-trading-among-farmers (TAF) scheme.

A topic likely to receive considerable thought from all parties is how the dividend paid by Fonterra is treated.

Until 2009 “the Payout” comprised a milk price and a value add component. As part of the 2009 capital structure changes, the value add component of the Payout was stripped out with that payment now being made as a dividend payable to shareholders. Not all of the dividend is paid out. Fonterra retains part of it under it’s retentions policy. Read more »

Victory in the Supreme Court

Wed, May 16, 2012 No Comments by tomwake

Tompkins Wake have recently assisted Kaimai Cheese and Grate Kiwi Cheese to a very successful outcome in the Supreme Court. James MacGillivray and Kate Cornege, with Phil Taylors’ help, represented Kaimai Cheese and Grate Kiwi Cheese in litigation against Fonterra, where the case concerned the meaning of the term ‘Independent Processor’ in regulations under the Dairy Industry Restructuring Act.

 In practical terms, the case debated whether it is permissible for a processor getting regulated raw milk from Fonterra to contract out all or part of processing that milk; Kaimai Cheese and Grate Kiwi Cheese argued yes and Fonterra argued no.

Fonterra had lost in the High Court and also lost on appeal in the Court of Appeal, but were then granted leave to appeal to the Supreme Court. James MacGillivray argued the case before the Chief Justice and four other judges of the Supreme Court with the result that Fonterra’s appeal was dismissed. The Supreme Court adopted the reasoning that the Tompkins Wake team had put forward for Kaimai Cheese and Grate Kiwi Cheese regarding the dairy industry restructuring act. A grate success for our clients!

Planning a Successful Sale of your Business

Wed, May 16, 2012 No Comments by tomwake

There are increasing signs that the recession is slowly coming to an end. Having made it this far, many business owners are starting to think about selling their business. But where do you start and how should you manage the process so that you achieve the best price and outcome?

The key to a successful business sale is planning. Most businesses are taken to market without adequate preparation, ultimately affecting the price received. Your best preparation is to:

  • Take steps prior to commencing the sale process to maximise your valuation. This can take some time, so start early.
  • Review the business and identify its weaknesses. This will allow you to correct problems before starting the sale process and minimise buyer price chipping during negotiations.
  • Decide on a structure and plan a successful sale with the help of your advisors. Your banker, accountant and lawyer are key to the process. See them early and jointly form a plan to get the deal done. Read more »

Clients Could Benefit From Change

Fri, March 2, 2012 No Comments by tomwake

Changes are afoot in international law firms that make it interesting to consider why law firms in New Zealand have remained very insular. Attempts to develop the way our profession is structured in other jurisdictions such as Australia and Asia have been small and relatively unsuccessful.

It should be possible for us to export the intellectual value of lawyers as a group, but as our business community has become more global the legal profession has mostly just watched. I believe the regulatory environment for managing law firms is a key reason for this failure. Read more »