VIL
30/09/2015 09:38
GENERAL
PRICE SENSITIVE
REL: 0938 HRS Veritas Investments Limited
GENERAL: VIL: Kiwi Pacific Foods: Arbitration
NZX Release
30 September 2015
Kiwi Pacific Foods: Arbitration
In 2014, Veritas Investments Limited (NZX:VIL), through its subsidiary, Midas
Foods Limited, purchased a 50% shareholding in Kiwi Pacific Foods Limited.
Kiwi Pacific Foods' main business is the manufacture of burger patties in New
Zealand. Kiwi Pacific Foods has been performing to expectations and is
continuing to actively look for growth opportunities in both the local and
export markets.
Veritas' joint venture partner in Kiwi Pacific Foods is Antares Restaurant
Group Limited, which operates the New Zealand Burger King franchise. Kiwi
Pacific Foods has a preferred supply arrangement with Antares under which it
has been supplying meat patties to Burger King in New Zealand. This
arrangement is documented in a joint venture agreement between Antares, Kiwi
Pacific Foods, Midas Foods, Kiwi Choice Limited.
In April 2015, certain disputes arose between the parties on the
interpretation of the supply terms and Antares sought to terminate the joint
venture agreement. Kiwi Pacific Foods, Midas Foods and Kiwi Choice
challenged the validity of Antares' termination notice. This led to the
commencement of recent arbitration proceedings involving the parties.
Despite these disputes, KPF has continued to trade with Antares.
The arbitrator has now issued a declaration that Antares' notice of
termination of the joint venture agreement is valid, and that the joint
venture agreement will terminate on 24 April 2016.
Veritas does not agree with this declaration and having obtained legal
advice, will seek leave to appeal the arbitrator's decision. In the mean
time, the existing preferred supply arrangements will continue on a business
as usual basis.
The Board will keep the market abreast of the developments in this regard.
For further information, contact: Tim Cook
021 764 401
[email protected]
End CA:00271005 For:VIL Type:GENERAL Time:2015-09-30 09:38:34
