Montana chairman to stay on but others will walk the plank

Friday 16th February 2001

By Nick Stride

Lion Nathan will seek board control of Montana without delay but the winemaker's chairman, Peter Masfen, is staying put.

Lion chief executive Gordon Cairns yesterday rubbished market talk that Mr Masfen was antagonistic to Lion's ownership of Montana.

"There's never been a hint of antagonism. He has handled himself in a most dignified and statesmanlike manner," Mr Cairns said.

He confirmed Lion, which on Monday gained 51% of Montana and control, would seek a majority of the seats on Montana's board. That probably means some of the present directors will have to go. Mr Cairns is the only Lion-appointed director.

The other directors are deputy chairman Barry Neville-White, managing director Peter Hubscher, Peter Coote, Hylton LeGrice and former managing director Bryan Mogridge.

Mr Cairns said Mr Hubscher had told him he was delighted things had been settled so there was no more distraction and that he was "looking forward to continuing his stewardship with Lion owning 51%."

Lion didn't see any need for immediate operational or strategic change.

"It would be hugely arrogant of me to suggest they should be doing anything differently. I think the results speak for themselves," Mr Cairns said. "They've got a first-class team, they've got a dominant position in the New Zealand market. Our job is not to manage the company."

Lion could help out with cost-saving measures through, for example, joint buying of common materials such as glass and cardboard. It could also help finance Montana's growth.

"We generate sufficient cash - after dividends, around $100 million a year. One of the potential benefits is if we free up cash that can help them expand rapidly."

There were also opportunities to exchange managers.

"But that's the icing on the cake. The cake is they're committed as a management team to a five-year plan. If they achieve that it'll be a fantastic result."

Mr Cairns said the plan foresaw a substantial increase in profitability, largely as a result of synergies coming out of the acquisition of Corbans.

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