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Rebuild task for new Murray Goulburn chair

 

Murray Goulburn has appointed restructuring expert John Spark as chairman as the dairy cooperative seeks to improve its financial performance and relations with farmers hurt by a surprise cut to milk prices a year ago.

in April 2016.

Mr Spark will take over at the end of March from current chairman Philip Tracy, who flagged his retirement at Murray Goulburn's annual general meeting in October 2016.

Mr Spark's appointment comes five weeks after new Murray Goulburn chief executive Ari Mervis started work to turn around the co-operative's poor fortunes over the last year.

Murray Goulburn said on Monday that Mr Spark, a former chairman of agribusiness Ridley Corp, is an expert in restructuring unprofitable companies, with 15 years' experience as a partner and then managing partner with receivers Ferrier Hodgson.

He also has agricultural experience, having owned a cattle farm near Yea in Victoria.

Mr Tracy said in October that he was ultimately responsible for Murray Goulburn's performance and he was deeply sorry for the impact that the April, 2016 cut to the farmgate milk price had had on dairy farmers.

Mr Tracy, who has been on Murray Goulburn's board since 2009 and chairman since 2011, would have been ineligible for re-election in 2018, because the cooperative's charter puts the maximum tenure period for a director at nine years.

Mr Spark said he was honoured to become chairman of Murray Goulburn.

"I look forward to playing a central role at Murray Goulburn and working closely with my fellow directors and chief executive officer Ari Mervis to build a stronger company for the future," he said in a statement.

Murray Goulburn has endured a difficult period since it cut the farmgate milk price in 2016 and downgraded its profit forecast.

The managing director at the time, Gary Helou, and chief financial officer Brad Hingle subsequently stepped down, and three directors quit the board.

The share price in Murray Goulburn's listed entity, the MG Unit Trust, has more than halved since April 2016.

Murray Goulburn and the MG Unit Trust face a shareholder class action, with investors alleging that they had been misled.

Murray Goulburn also cut 200 jobs and in February posted a first-half loss of $31.87 million, compared to a profit of $10 million a year earlier.

Mr Tracy oversaw the float of the MG Unit Trust, a special vehicle that allows non-dairy farmers to invest in Murray Goulburn, on the Australian Securities Exchange in 2015.

Shares in MG Unit Trust were 2.5 cents lower at 97.5 cents at 1343 AEDT.