Campaign to buy Cadbury factory nears pledge target
A crowdfunding campaign to buy the Cadbury factory in Dunedin is nearing its target of $5 million.
As of early this morning, the site – set up on Wednesday – had gained pledges worth $4.3 million.
Mr O'Malley says he hoped to raise $5 million through the crowd-funding effort, which he saw as providing a "stepping stone to getting the rest of the money." He estimates $20 million will be required. It depends, in part, how much Mondelez would charge if it does choose his outfit for contract work, and how much it costs to take over its plant, or part of it. All of those major details have yet to be negotiated.
He tells NBR he'll be targeting "wholesale and institutional investors" for the remaining $15 million.
He stresses, "This is not a typical crowdfunding. It's more of an expression of interest; a campaign before a campaign. We're looking at it more of a public vote of interest."
Pledges are non-binding. Most are for $100 or $200 he says but one un-named person has promised $200,000.
Assuming pledges do top $5 million, a formal crowdfunding campaign will be launched on a site like Snowball Effect or PledgeMe.
One practical problem: such sites are currently restricted to a $2 million cap under FMA rules.
About 350 jobs are due to be lost as Cadbury's multinational owner, Mondelez International, closes its Dunedin plant in early 2018.
Mr O'Malley's plan is to bid to produce several lines of chocolate for Mondelez under contract.
His initial plan is to take over one of the factory's production lines, with 15 staff hired to work the line plus another 10 in support positions from late 2018. Current staff will get first dibbs on the new positions.
Over up to a decade, he hopes to get three production lines up and running, with a total of 69 staff.
The councillor has plans to form a company for his bid, to be called Dunedin Manufacturing Holdings. He says that's a "volunteer name." The actual name and structure of the company will be decided after the pledge campaign closes on June 21.
Mondelez said in a June 9 statement that it had received several expressions of interest from parties wishing to take over production of Kiwi treats including Jaffas and Pineapple Lumps.
"While we take the time to assess the responses we have received from interested parties including Mr O'Malley's community-based initiative, it's not appropriate for us to comment on the specific detail of these responses," the company said.