All 30 South Canterbury farmer suppliers of failed New Zealand Dairies’ Studholme milk factory have signed up with Fonterra, the co-operative says.
Fonterra’s offer is part of its proposal to buy the factory from the receivers of the Russian-owned company. The proposal must be cleared by the competition watchdog, the Commerce Commission.
If it goes ahead, the farmers will recoup all they are owed by New Zealand Dairies.
Two milk payments worth about $25 million were not made to the farmers before the company went under last month.
Fonterra will run the factory for the receivers while the commission decision is pending as part of the deal to make sure the farmers can supply milk for the upcoming season, which begins on August 1.
The farmers were offered contracts for three years supplying milk, followed by three years to buy shares in the co-operative.
They can start buying shares after the 2012-2013 season.
The company had said its purchase of the factory was dependent on getting farmer suppliers on board.
NZ Dairies failed after its Russian owner, baby food producer Nutritek, could not sell its multimillion-dollar factory, which can turn 200 million litres of milk into milk powder each season.
MICHAEL BERRY
