Woolerton R Doug: Budget Debate 
Woolerton R Doug: Budget Debate 
[Volume:647;Page:16474] 
R DOUG WOOLERTON (NZ First) 
: 
 Before I begin I would like to thank the Labour Party and Minister Mallard for ceding to me his place in this Budget debate because there are some issues we want to cover that I have previously talked to the House about. I say thanks to him. 
New Zealand First is very concerned about the Overseas Investment Office tick-off for the Russian company Nutritek to buy up to 100 percent of New Zealand Dairies Ltd based in southern Canterbury or northern Otago whichever; Studholme is the place. We are concerned about that because this is a precedent-setting decision. This is the first time in this country that we have seen a situation where we could have 100 percent overseas-owned dairy companies. We believe that it is precedent-setting for that reason. I said in a letter to both Ministers Cullen and Parker that I do not believe that this should be given permission to go ahead because how will they stop this in any other situation that arises throughout the dairy industry in New Zealand? These small dairy companies are sprouting up around the country but when I say “small” they are $100 million - enterprises so they are not small in terms of overall business but they are small in terms of the dairy industry. 
I wrote to them and said that if a hostile takeover were mounted on any one of these companies it would not be able to be withstood by the New Zealand shareholders. Even Open Country Cheese Co. in Matamata one of the bigger and better ones run by Messrs Luxton and Creech who used to be in this House has to all intents and purposes been taken over by Talley’s Group Ltd. We have never raised any question about that. We in this House all know Mr Talley. We know he has extensive interests in the food producing business and he is a New Zealand company. That is the point of difference. We are not going on about the sale of a company; we are going on about the sale to overseas interests. 
In this particular case we have had a recent communication that led to Mr Peters seeking leave this afternoon to talk about this issue. I shall read a part of that communication to the House: “We recently became aware of the extent of these issues.’’—that is relating to the takeover of Nutritek. “This has given Nutritek Group cause to look afresh at the situation which developed last year with respect to New Zealand Dairies Ltd and the actions of certain parties within the negotiating process. We are conducting an internal review into these matters. While this is taking place certain employees of our company have been asked temporarily to stand aside from their duties.” 
So even there at the heart of this matter we have concerns. We were told in this House that there were no concerns from the participants to this deal but in fact there were. I have reason to believe that certain people brokered this deal behind the backs of the original shareholders and I believe—and this is in the  
North and South 
 article as well—that a situation was manufactured where this company was seemingly short of money for development in the developmental stages. 
Mr Cliff Skeggs who is not exactly a person without mana in this country said that in his view this shortfall was not “due to stainless steel”. In other words in dairy company terms it is not due to the manufacturing of the plant. It is not due to any of those things. This was an event that was made to happen and it was made to happen in his view by a certain gentleman who was operating on both sides and whose interests clearly lay with ensuring that the Russians put their money into this company and subsequently as we now know they took it over at a later date. 
That is a mechanism in our view and we should not be saying that it is OK to gain a company by a financial mechanism. We believe that if people come in here and make a bid and truly want to invest in this country there are avenues through which they can do so. But to take over a fledgling dairy company by a mechanism is something this Government should not be seen to be associated with. 
We know that this company was set up by dairy farmers in that area and we know there is one very big dairy farmer a guy called Aad van Leeuwen. I have been to visit him and his lovely wife. They had views of vertical integration and good on them for that. They set this company up with other shareholders. There is anther guy who actually set up Open Country Cheese Co. in Matamata a guy called Greg Missen. I am also in constant contact with him. He was the brains behind the manufacturing plant and he went about setting that up. Both these people believe they were ripped off and manoeuvred out. 
These are New Zealanders. Mr van der Heyden is the chairman of Fonterra and Mr Aad van Leeuwen is a gentleman who came to this country and has made a huge success of his dairying enterprise. These people wanted to make sure that New Zealand’s produce was manufactured in New Zealand and sent across from these shores to other countries in a finished state. This company Nutritek has interests throughout Asia. It hails from Russia and its interest—and this a serious point—is in the raw product. It has no intention of adding value to this product in this country. I noticed that in replies to my questions at question time today it was said that these people would add value and technological expertise. That is not correct. That added value will take place in Singapore and countries outside of New Zealand. 
Their intention with the Studholme plant is to do the most basic things. They will turn the raw milk product to powder which is the first process—they take the water out of it. They then ship it offshore to the other plants that then make the highly valuable baby products—nutraceuticals I think they call them—and that is where the value will be added. We in New Zealand are missing out on all the upstream opportunities on this product. That is why we are opposed to this Nutritek thing. We now have reason to believe that it is these underhand methods—fraudulent could be the word—that have allowed this Russian company to take over New Zealand Dairies Ltd. We will not rest until we have got to the bottom of this and we will hold these people to account.