Dairy farmers dash for Milk Marque shares
By Boyd Champness
ALREADY 60% of Milk Marque members have taken up the co-operatives offer to convert their certificates of entitlement to preference shares.
Members supported a proposal at the Milk Marque AGM in August this year to convert to preference shares, enabling the co-op to consolidate its capital and use producers money for future investments or possible acquisitions.
Milk Marque press officer Michelle Conaboy said the co-op anticipates that almost all members would take up the offer before the September 5 deadline.
Preference shares are more secure than ordinary equity shares, yet preference shareholders have no voting rights. Unlike equity shareholders, Milk Marque members will not receive a dividend, but instead will be paid interest on the preference shares they own.
All members were given certificates of entitlement when the milk industry was deregulated and Milk Marque created in 1993. The value of the entitlement depended the amount of milk members produced during the 1993-94 season. Those who chose not to stay with the co-op were paid out in April.
Ms Conaboy said members would be restricted to £20,000 worth of preference shares. In the event that a farmers entitlement is greater than £20,000, he or she will receive £20,000-worth of preference shares, and the rest will be issued as loan stock.
There will be “share-trading days” every year which will give members the opportunity to buy and sell shares. The first share-trading day will be on May 1, 1998.
Alternatively, members can sell and buy Milk Marque shares by contacting the Lloyds register. Non-members cannot buy preference shares. However, they will be able to acquire “loan stock” in the company, which is virtually the same as preference shares.