MORE than 270 Wesfarmers Ltd shareholders attended the company's Ownership Simplification meeting at Albany last week as the company toured the state on an information campaign.
The meetings were chaired by Harry Perkins, the chairman of both Wesfarmers and the Westralian Farmers Cooperative Limited. Providing the answers to shareholders questions was Wesfarmers Limited managing director Michael Chaney.
In the proposal scheduled to be voted on by shareholders in Perth on April 6, 2001, Wesfarmers Ltd will acquire all stock units in the Co-operative (WFCL) and the units and options in The Franked Income Fund (FIF) in return for Wesfarmers shares.
If the Albany meeting was any guide to shareholders intentions, there could be a strong vote at the April meeting, in favour of the directors' unanimous recommendation.
After Mr Chaney described the background to the proposed structural change, the meeting was thrown open for questions.
One concerned the company becoming vulnerable to a takeover after the restructuring. Mr Chaney said Wesfarmers was a conglomerate and conglomerates were rarely taken over.
"The best defence against such things occurring is good company performance," he said.
On being asked what could occur if there was a worldwide downturn in business activity and performance, Mr Chaney said Wesfarmers' future had a very positive outlook including good profit rates.
"We cannot control what happens in the share market ‹ share prices track profit erratically and with volatility," Mr Chaney said.
"As to our commitment to WA, the best evidence is our continuing investment in IAMA, Westrail and new product from CSBP. Wesfarmers is in for the long haul."
Shareholders were reminded that 98pc of them approved of the formation of The Franked Income Fund (FIF) at the time of the previous reconstruction.
The company's interest in bluegum plantings had been sold. Mr Chaney said there was difficulty in projecting prices of woodchips across a five to 10 year period.
Mr Perkins stressed the importance of shareholders filling in and returning proxy forms sent to them.
"The reality is it is hard to keep growing as a company without the proposed changes ‹ we are absolutely convinced the changes are in the best interests of our shareholders," he said.
The restructure also involves Graham Partners Management Limited (GPML), the responsible entity for FIF.