News

VDL Farms board resigns en masse

By Dairy News

THE OWNER of Chinese company Moon Lake, which owns Van Dieman’s Land (VDL) Farms in north west Tasmania, has declared it is “business as usual” despite the mass resignation of directors and the CEO.

Moon Lake Chairman, Xianfeng Lu, who is the sole owner of Moon Lake, said there would be no loss of jobs.

All non-executive directors of Moon Lake resigned last month, while VDL Farms CEO, Evan Rolley, will not extend his contract beyond June 30.

The former Deputy Chair, Dr David Crean, said the four non-executive directors were concerned that “proper governance arrangements are not being considered in a proposed restructure of the company’s business interests in Tasmania by sole owner and Moon Lake Chairman, Mr Xianfeng Lu”.

“The non-executive directors of the board had particular issues with the restructure arrangements relating to the running of the 24 VDL farms in North-West Tasmania,” Dr Crean said.

“The board, being responsible for overseeing the commercial and prudential operations of the VDL farms, could not convince the owner to adopt their recommendations on future management of the business.”

The board requested $2 million to drought proof the properties but this was rejected.

VDL farms is currently running between 28 000 and 30 000 cattle and produces around 100 million litres of milk, which is sold into the Chinese market.

Despite the resignations, the Foreign Investment Review Board has approved the corporate restructure of Moon Lake to Chinese Ningbo Xianfeng New Material Co Ltd (APlus), which is listed on the Shenzhen Stock Exchange.

Mr Lu released a statement saying: “As part of the restructure an Australian holding company will be set up to coordinate the Australian operations and to ensure alignmentwith overall strategic goals. Moon Lake and its sister company Van Dairy will be moved under control of the new holding company.”

Van Dairy is a sister company of Moon Lake and was set up in April 2016 to export dairy products to China.

Mr Lu said the strategic goal for the group was to become “a fully vertically integrated dairy business with quality dairy products sold both internationally and domestically”.

The board of the new holding company will appoint a new CEO for the group and a general manager for VDL Farms “in due course”.