Board coup completed without a peep at carpet play Bremworth

Tuesday, 18 March 2025

NZX-listed wool carpet producer Bremworth starts Tuesday with an almost band new board and chairman.

At NZME, an attempt by aggrieved shareholders to replace the existing board continues to cause ructions, but the same thing at listed carpet play Bremworth has been achieved without a peep.

This morning, Bremworth told the NZX that a group that had launched an attempted coup less than three weeks ago had been duly appointed to its board as new independent directors.

Rob Hewett, Julie Bohnenn, Murray Dyer and Trevor Burt will become independent directors “with immediate effect”, with Hewett, the outgoing co-chairman of meat company Silver Fern Farms, becoming Bremworth chairman.

Existing board members Paul Izzard, Katherine Turner and Dianne Williams will step down, while George Adams, who had been Bremworth chairman until today, and John Rae will stay as board members.

Outgoing co-chairman of Silver Fern Farms, Rob Hewett, is now chairman of Bremworth.

Less than a month ago, Hewett led a rebel group of shareholders in demanding a special meeting to overthrow the board, saying Bremworth’s results were not good enough. Earnings had slumped to $80.3m in 2024 from $148.1m, and operating costs remained overly high, the group maintained.

Meeting requested, called

Hewett said at the time about a third of the company’s shareholders supported the coup, his group called for a special meeting to put board renewal to shareholders. Then-chair Adams agreed to the special meeting, but also expressed surprise at the group’s accusations and defended its work towards a strategic overview of Bremworth, which may or may not lead to selling the company.

The special meeting is now off.

“As a result of the constructive engagement since the 1 March 2025 notice requesting that a special shareholders meeting be convened to consider proposed director changes, the requesting shareholders have withdrawn their notice,” the statement to the NZX this morning said.

Each new director will stand for election at Bremworth’s next annual meeting, however.

Former chairman George Adams will remain on the board at Bremworth.

As well as being co-chairman of Silver Fern Farms, Hewett is also chair of WoolWorks and Farmlands Co-operative, and was named Chairperson of the Year at the 2023 Deloitte Top 200 Awards. He promised that under his leadership, the new board will conduct a comprehensive review of Bremworth’s operations, “ensuring disciplined financial management and a renewed commitment to the company’s core business and growth opportunities.

“Bremworth is at a crucial crossroads. We appreciate the hard work and dedication of the board under George’s leadership during a very challenging period for Bremworth, and its settlement of the long-running insurance claims process. We will need to call on the experience of all directors as we take Bremworth into its new era, which demands a fresh approach to drive growth and earnings,” he said.

“The new directors and I are committed to bringing our collective agri, operating and governance experience and skills to stabilising the business, protecting shareholder value, and unlocking the potential of Bremworth.”

A key priority for the revamped Board is to ensure the latest $42.2 million insurance settlement is “strategically allocated”. The strategic review of the company, currently underway, will continue.

Shareholders Association

The New Zealand Shareholders Association has assessed the calls to replace the boards of both Brewmorth and NZME, finding that unlike in the past where it had called for a board refresh at New Talisman Gold Mines and Fletcher Building, the cases for board renewal were not as clear-cut.

Rotherham School is among the rural Kiwi schools that want woollen carpet through their classrooms, but are unable to get it.

NZSA chief executive Oliver Mander said NZME and Bremworth both had a clear (albeit, ‘in progress’) strategies, and both had independent boards with no perceived conflicts that impact their ability to hold the chief executive to account.

Mander said of former Bremworth chairman George Adams that he “must be wondering when he might be able to catch a lucky break.

“A new strategy devised in 2020, that saw the company focus on the manufacture and marketing of woollen carpets and rugs, has been interrupted by Covid-19, Cyclone Gabrielle, the subsequent loss of market share (revenue) and re-invention of supply chains aimed at maintaining longer-term customer relationships (costs) and the navigation of a complex insurance process.”

Overall Mander said the issues, and potential solutions outlined by the rebel shareholder group, seemed to be in strong alignment with that of the current board, lending itself to a ‘collaborative’ approach to solving the vexed problem of board renewal, rather than focusing on the ‘scorched earth’ alternative.