SPC faces an even greater crisis than it faced in 1982 when Henry Barrass resigned as chairman and I was unanimously elected as chairman of the board, because the company was facing a loss of $5million and had a mountain of $120million of old debt.
By 1989, due to my introduction of fruit in its own juice plus other key initiatives, sales increased from $75million to more than $170million and the mountain of debt had been reduced to $65million.
By the end of 1989, the sale of Monbulk brand names, labels and stock to Cadbury Schweppes for $30million made a major contribution. This enabled SPC to immediately launch SPC 100% fruit spreads (no cane sugar) out of the Monbulk plant and using the new Shepparton paste plant.
In 1989, pre-interest profit of SPC was more than $13million, however, it was swallowed up with interest rates at 21 per cent.
By mid-1990, after the Letona merger was planned to be completed, a partial float along the lines of Wesfarmers was to leave SPC debt-free and place the future of SPC in the hands of the growers.
A number of big grower shareholders wanted to have control of SPC so they struck before there was a merger of SPC with Letona, as they stood to lose the balance of power.
Hence their determination to seize control of SPC and they achieved a 50.4 per cent shareholder vote at the 1990 Annual General Meeting to remove all independent directors and myself.
I emphasise I have always valued all growers and always acted fairly with everyone.
The new board had a philosophy of ‘going back to basics’ and set about dismantling all the key strategic initiatives and also ‘outsourced’ factory door sales.
They scrapped all initiatives in fresh sales which were set for take-off and scrapped SPC Fruit Spread.
They dropped the Letona merger, falsely claiming it was too generous to Letona growers when in fact once the merger was complete all growers would receive the same price for their fruit.
The Monbulk facility was basically wasted as they had no comprehension of the value of the new SPC 100% Fruit Spread (no cane sugar) also made possible by the new paste plant at Shepparton, or the future potential of canned and fresh green asparagus.
Finally a proposed joint venture with Tri Valley Growers (the biggest deciduous fruit canner in the United States) to take over Del Monte in Greece to provide an EU tariff-free market entry was lost.
The great opportunity to avoid the nightmare that followed with the high Australian dollar, the failure to eliminate the remaining mountain of debt, failing to avoid massive tariffs of the EU and achieving collection of EU production grants was lost.
Ultimately the big growers in control realised the tragic mistake of abandoning the Monbulk facility and ended up buying the IXL Kyabram Plant for the extremely high price of $50million.
Smucker’s, the US owners of IXL, could not believe their luck and left Australia all cashed up.
This tragic era was then followed by the murky merger of SPC and Ardmona which led to big grower shareholders gaining millions of dollars at the expense of the new business and the small growers.
It is interesting to consider: who has benefited from SPC over the past 29 years?
To insinuate the 1990 loss precipitated by the new board was my doing is preposterous and deceptive.
Such falsehoods could potentially lead to the wipe out of the Australian deciduous fruit industry if someone with no belief in resurrecting SPC buys the business with another agenda in mind.
The success of SPC during my period as chairman has no parallel and the vision the board developed is still totally relevant.
Worth preserving: 100 Years of SPC concludes with managing director Reg Weine saying: ‘‘We are more than an iconic regional food producer — we are a national treasure.’’
I take this statement seriously as it endorses our plan to ‘Make SPC Great Again’.
—Haset Sali
Sunshine Coast
19°C