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Hawke’s Bay
Seeka Kiwifruit Industries [NZX: SEK], the country’s largest kiwifruit orchard services and post harvest operator, will join the $885 million class action against the Ministry for Primary Industries over the 2010 outbreak of Psa-V vine disease, seeking compensation for the devastation of golden kiwifruit crops in the Bay of Plenty.
The Te Puke-based company estimates the Psa bacteria has cost it more than $45 million, and prompted it to slash its workforce by 40 percent to mitigate the impact of the outbreak, which is still impacting on the kiwifruit grower and coolstore owner.
"Having fully considered the financial and human impacts on Seeka and its people of the alleged biosecurity breach and the loss of wealth by our shareholders, Seeka has taken the decision to join the class action," chief executive Michael Franks said in a statement. "Seeka has seen the legal opinions both for and against and offers no opinion on their merits, other than to say in our opinion, there is merit having them tested."
Last week, Zespri International, the country's kiwifruit market body, urged growers not to join the action, saying it would compromise the industry's relationship with the government and complaining it had not been consulted before the action was launched.
Seeka said it rejected any argument the claim would put Zespri's statutory monopoly export position for all foreign markets bar Australia at risk, saying "the government has on a number of occasions outlined its responsible policy that so long as growers support the single desk then the government will leave the desk settled."
The kiwifruit grower reiterated its support for Zespri, and said the single desk isn't involved in the action.
"We understand the group of growers seeking support for this action considers it to be a matter of accountability and compensation," the company said.
Shares of Seeka last traded at $3.10 on Friday, and have climbed 48 percent this year.
(BusinessDesk)
Paul McBeth
Mon, 06 Oct 2014
Mon, 06 Oct 2014
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