APPROPRIATELY enough, John Duggan, the chairman of food and dairy group Avonmore and his counterpart John Dowley of Waterford Foods celebrated their agreed but nonetheless contentious convergence of interest this week, not with champagne but a jug of milk. After much circling and posturing over what was the optimum price for Waterford shares and in the best interests of suppliers, it finally came down to horse trading, not so much if a deal could be struck but at what price. Both men soon hope to have metaphorical spittle on the palms to formally shake hands on the £337 million merger, the biggest in Irish dairy history However, within the next three months the support of 75 per cent of shareholders must first be secured.
While an extensive campaign is underway to explain merger benefits to farmers the rich cream of promised mutual benefits has already begun to sour. Farmer groups in Waterford have voiced strong opposition, the air heavy with accusations of management attempting, by sleight of hand, to strip farmers of a substantial amount of control over their livelihood. The feeling among a disaffected rump of Waterford suppliers is that the conversion of farmers' assets into plc shares is a ruse in order to secure control.
Management in both camps are naturally pushing the message that the spirit of Father Dyer lives on, merely being adapted to contemporary realities. There is much talk of increased profit levels and enhanced shareholder value throughout all strata of the new grouping, which will have its administrative headquarters at the Avonmore facility in Kilkenny.
Coincidentally, this week the European Commission moved in to give milk a modern image for the new millennium. The EU is to instigate a community wide promotional push to encourage milk consumption by young people, the message being that milk and milk products are sexy, modern, nutritious and a trendy substitute for harmful alcohol. No argument there from the two Johns.
. INTEL and Digital Equipment, two global giants in computer technology, were this week booting up their lawyers for an expensive confrontation over the legal nuances of intellectual property rights and patent infringement.
Digital fired the first salvo two week ago, lodging a court action accusing Intel, the world's leading producer of computer chips, of patent infringement. Digital alleges that Intel had pirated 10 of its patents to enhance the performance of its Pentium product line. Intel was quick to counter charge that Digital had violated its intellectual property rights, claiming that Digital had refused to return confidential documents, which the group had transferred under a mutual benefit partnership relating to microprocessor design and future development projects.
The Intel suit seeks only the return of property and does not carry a claim for financial damages. Digital, however, is going for the jugular in seeking damages, which, according to chairman Robert Palmer, are likely to be "huge".
. DESPITE incurring losses of £1.6 million on a joint venture wood mill project with a US company, the State owned forestry company Coillte managed to add around £1 million to net profits last year which rose to £13.55 million. Coillte has a 35 per cent interest in the Waterford mill project, with the Louisiana Pacific company holding the majority. Although this enterprise is expected to be out of the financial woods within two or three years Coillte chief executive Martin Lowery says that loss this year will at least equal last year's £1.6 million. The problem is one of global overcapacity with the output of new competitor mills flooding the market, particularly in the US. The mill is now concentrating its output towards European markets.
Acquiring suitable land for forestry remains difficult, with the level of land acquisition by Coillte last year the lowest to date. Increased planning requirements, alternative land use grant schemes and increased land usage as natural heritage sites are cited as particular difficulties for the company which already owns around 5 per cent of all land in the State.
. THE humidity of the past week will have come as a further irritant to many office workers, cocooned in already fetid working environments with poor air quality and inadequate ventilation, a breeding ground for headaches, nausea, a general feeling of malaise, which invariably leads to rising absenteeism, and higher costs for the employer. Perhaps time to put Monika, the model office temp, on the payroll?
Although tending towards inertness and nil productivity she (or he) at least keeps itself to itself, does not answer back or waste half the day chewing over office politics at the water dispenser. For Monika is a cross dressing, computer controlled dummy, loaded from head to toe with electronic sensors, masquerading as an office worker to scientifically report on what has been termed "sick building syndrome". The male or female mannequin has a human body temperature and passively responds to a wide variety of environmental stimuli, "breathing " through its nose and mouth. Sounds like someone we all know, doesn't it?
