Office told of Cedenco owner's US inquiry

A group against foreign control of business in New Zealand says it warned the Overseas Investment Office a year ago about a United States federal investigation of SK Foods, a company linked to the owners of Cedenco Foods.

Cedenco collapsed into receivership on Monday, although ANZ Bank is providing seasonal finance to keep it trading before a sale next year.

Food processing industry sources said there was no obvious buyer for Cedenco in New Zealand, but they hoped it would be picked up by a local operator such as Heinz Wattie, although that is foreign-owned.

One of New Zealand's biggest vegetable processors, Cedenco failed under the weight of high debts and problems with a breakdown at a "shareholding and governance level".

Both SK Foods, which has filed for bankruptcy protection in the US, and Cedenco were owned by a Salyer family trust. SK Foods does not own Cedenco directly.

There is also an ongoing federal investigation into SK Foods and senior management including bribery allegations dating back to last year.

Campaign Against Foreign Control of Aotearoa organiser Murray Horton said the group wrote more than a year ago to the Overseas Investment Office questioning whether Cedenco's owners were of "good character", as required by the Overseas Investment Act.

Mr Horton said the body had turned a blind eye to anything that could be seen as an impediment to the relentless takeover of the country by transnational corporations. The OIO acted as a rubber stamp, not a regulator or investigator, he said.

But OIO lawyer Pedro Morgan said to the best of its knowledge no charges had been laid against either SK Foods or its founder Scott Salyer, and Mr Salyer had denied any wrongdoing. With no charges laid there was nothing for the OIO to investigate, he said.

Meanwhile, Cedenco receiver Brendon Gibson confirmed there had been various resignations from the board of Cedenco recently.

Companies Office records show Frederick Scott Salyer of California resigned as a Cedenco director on November 2. Fellow US-based director John Kenneth Skeen also resigned on November 2, just a week after he was appointed.

Cedenco chief executive Richard Lawrence resigned as a director on October 27. But Mr Gibson confirmed Mr Lawrence would remain as chief executive and would return from overseas this week.

- © Fairfax NZ News