Christchurch-based wool processor and trader New Zealand Wool Services has welcomed the Commerce Commission’s preliminary endorsement of its merger with Cavalier Wool Holding’s wool scouring operations in New Zealand.
Cavalier’s scouring services will be merged with the scouring assets of New Zealand Wool Services International, owned by Australian-based wool processor and merchant Lempriere, pending final Commerce Commission approval.
Lempriere managing director William Lempriere said the purchase was a positive and overdue result for the New Zealand wool industry.
“New Zealand will retain a world-class scouring industry in New Zealand operated by an independent commission processor for the benefit of growers and exporters.
“It means jobs stay here, and Kiwi wool growers and exporters will realise the competitive benefits they’ve been needing from an efficient, combined, wool scouring business.”
Mr Lempriere said the merger was part of the wool industry's consolidation.
“Reducing wool supply has seriously affected the viability for the two scouring entities and we're playing a key role in helping scouring consolidate without it turning into another industry loss to New Zealand.
“The Commerce Commission said the benefits to the industry of this merger were clear. There were too many scouring services for the size of the industry. Now it will be right-sized.”
Lempriere has been active in the New Zealand wool and textile industries since the 1970s. Over that time it has made extensive investment in South Island high country farming, wool trading, exporting and scouring.
“We have more than 150 years’ experience and commitment in global wool and cotton agri-business,” said Mr Lempriere. “We’re committed to growing the wool industry in New Zealand.”
The group of companies is also involved in textile processing and innovation in Levin, the development and commercialisation of medical devices, wholesale and retail apparel operations and the establishment of an industrial design, research and development and innovation hub in Tauranga.
For more information please contact: John Mitchell +64 27 975 4094
About Cavalier Wool Holdings:
Cavalier Wool Holdings is 100% New Zealand owned – 50% by Auckland-based Cavalier Corporation, 25% by Direct Capital, and 25% by NZ Government-owned ACC. CWH processes greasy wool into clean wool for export on behalf of New Zealand wool exporters. It operates three plants, two of which are in Napier at Awatoto and Clive, and a plant based in Timaru.
New Zealand Wool Services International Limited (WSI) is privately owned as part of the Lempriere group of Companies. WSI operates two scouring plants: the Kaputone Wool Scour in Christchurch, and the Whakatu Wool Scour in Hawke’s Bay. WSI is New Zealand’s largest wool exporter exporting wool to markets in over 30 countries around the world. WSI’s global headquarters are in Christchurch, New Zealand with international offices in China and India.
The Australian-based wool processor and merchant is looking forward to Commerce Commission approval for the merger, which will see New Zealand wool scouring consolidated into a more effective and efficient operation.
The merger would see the scouring industry operated by an independent commission processor for the benefit of growers and exporters.
Lempriere has been active in the New Zealand wool and textile industries since the 1970s and has made extensive investment in South Island high country farming, wool trading, exporting and scouring.
Cavalier Wool Holdings owns two wool scouring plants in Hawke’s Bay and one plant in Timaru.
WSI is a wool scourer and wool trader with scouring plants in Hawke’s Bay and Kaputone, near Christchurch.
The merged scouring business will be 27.5% owned by Cavalier Bremworth, while Direct Capital and the Accident Compensation Corporation will have 13.75%. WSI’s parent company, Lempriere, will acquire a 45% shareholding in Cavalier. WSI will retain its wool trading business.
Lempriere managing director William Lempriere said the application was an important step toward bringing much-needed consolidation and efficiency to the New Zealand wool scouring industry.
Lempriere, an international operation with more than 150 years’ experience in global wool markets, completed the $31 million purchase of wool trader and scourer WSI this week in what is a natural extension to its previusly merino dominated business.
“Our purchase of WSI is another significant investment we’ve made in the New Zealand wool industry,” said Lempriere managing director William Lempriere.
WSI’s current annual turnover is approximately $200 million. It handles about 250,000 bales of scoured strong wool annually.
Declining returns for wool compared to alternative uses for the land is the biggest issue facing the wool industry today. Sheep numbers and wool supply is declining.
“We believe in the fibre and it is our core activity, so we continue to invest in the wool industry. We want to work with all serious participants in New Zealand to provide a world class service that’s will ultimately benefit growers” said Mr Lempriere.