Red meat processor Dawn Meats has confirmed it will acquire a 65% shareholding in New Zealand meat processor Alliance Group, with farmers to retain a 35% stake.
Dawn Meats welcomed the decision of farmer-shareholders to vote in favour of a proposed NZ$270 million (€132 million) strategic partnership.
A total of 2,675 shareholders voted, representing 92,495,558 shares or more than 88% of all shares on issue. Of these, more than 87% voted in favour of the proposal, meeting the threshold required under the Takeovers Code.
Niall Browne, chief executive of Dawn Meats, commented: “We are pleased and excited by the outcome of the vote by Alliance’s farmer-shareholders and we now look forward to maximising the potential of the new opportunities this strategic partnership will unlock in the future for both Dawn Meats and Alliance.
“Following an extensive engagement and due diligence process, Dawn Meats put forward a strong strategic partnership proposal involving a significant investment in a world-class company that shares our values, ambition and commitment. I would like to thank Alliance’s farmer-shareholders for carefully considering our offer over the last two months and supporting it to such an extent.”
“Having the ability to… create a year-round supply for our customers between the Northern and Southern Hemispheres is a fantastic opportunity and one our customers are already responding to.”
Niall Browne, Dawn Meats
Browne continued: “Dawn Meats has a proven track record of successfully partnering with other businesses and we believe this joint venture with Alliance will assist in further growing and developing what is an excellent New Zealand business with a proud legacy of processing and exporting the highest-quality grass-fed lamb, beef and venison.
“Dawn Meats already has a strong operations network in Ireland, the UK and in the EU. Having the ability to now grow in partnership with some of New Zealand’s leading farmers and create a year-round supply for our customers between the Northern and Southern Hemispheres is a fantastic opportunity and one our customers are already responding to.
“We believe this partnership will create a dynamic industry competitor with a unique combination of customer relationships, resources, skills, routes to market and industry knowledge, giving both Dawn Meats and Alliance a powerful competitive edge, locally and globally.
“In addition to thanking Alliance’s farmer-shareholders, I would also like to thank the Board of Alliance, the company’s leadership and staff of Alliance Group, who assisted us throughout this well-managed process. Our existing team in Dawn Meats and Dunbia look forward to working with our new colleagues in Alliance and I would like to welcome them to the Dawn Meats family.”
Reaching the lamb and beef markets
Mark Wynne, chair of Alliance Group, said the result demonstrated “strong farmer confidence” in the company’s future direction: “Our farmer-shareholders have given a clear mandate for Alliance to move forward in partnership with Dawn Meats. This is a vote of trust in our people, our operations and our vision.
“We’re really excited about the potential for this partnership and what the future holds for Alliance and Dawn. This essential investment will strengthen our financial position, enhance our operational capability and enable us to capture more value in market for our farmers and the country. Importantly, the agreement also preserves farmer ownership, with a continuing 35% shareholding and strong governance rights.”
Wynne stated that the positive outcome had followed a two-year process to reset and re-capitalise the business. He continued: “The Board explored every option to secure Alliance’s future. The Dawn Meats proposal stood out as the best strategic and financial path forward, a view confirmed by independent adviser Northington Partners.
“By combining Alliance’s lamb expertise and global reach with Dawn Meats’ strength in beef and market access across Europe and the UK, we can unlock significant commercial and operational synergies.
“This partnership gives our farmer-shareholders the opportunity to see the value of their residual 35% stake grow over the long term. On behalf of the Alliance Board, I want to thank shareholders for their trust and confidence, and the Alliance team for achieving a remarkable turnaround. The future looks much brighter than it did 12 months ago. We’re looking forward to getting down to work.”
Approximately NZ$200 million of the investment proceeds will be used to reduce Alliance’s short-term working capital facility, with the balance directed toward accelerating the Board’s strategic capital expenditure programme.
Farmer-shareholders will also benefit from distributions of up to NZ$20 million in both the current (FY25) and next financial year (FY26). In FY25, 45% will be paid as a dividend and 55% as a supply-based rebate.
Dawn Meats said that in FY26, 75% will be paid as a rebate and 25% retained as earnings. Rebate payments will be calculated on a three-year rolling average of supply and capped at the current shareholding. In addition, up to NZ$25 million will be distributed as a dividend from the joint venture to the proposed Alliance Investment Co-operative following a “stronger-than-forecast” year-end result for Alliance.
Wynne concluded: “This outcome provides Alliance with a strong foundation for the future.
“We are now well positioned to thrive alongside a complementary partner like Dawn. Together, we will deliver enduring profitability, significant global opportunities and capture greater value for our farmer-shareholders.”
