Fonterra fallout: Romano quits

Botulism scare claims first scalp.

Fonterra Cooperative Group's tainted food scare has claimed its first scalp with the resignation of NZ Milk Products managing director Gary Romano.

Mr Romano, who initially fronted for Fonterra to New Zealand media while CEO Theo Spierings went to China, has resigned effective immediately.

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Mr Romano told media today that at the first press conference as the crisis broke, he mistakenly gave the impression that all Nutricia Karicare products could potentially be contaminated.

The NZ Milk Products manager also became the lightning rod for criticism over Fonterra's refusal to same the other seven affected customers or the brands involved.

Mr Spierings will personally assume interim responsibility for the daily operations of NZ Milk, which collects milk from New Zealand farmers and manufacturers it into dairy products ready for export.

Mr Romano's focus was "to drive profitability through a customer-centric approach to business that delivers world-class standards in productivity, quality, safety and service," Fonterra said on its website

The contamination was confined to 38 metric tonnes of whey protein concentrate (WPC80) manufactured at Fonterra's Hautapu plant near Cambridge and first picked up at a plant in Australia. It was used in the manufacture of infant formula, juice and dairy beverages, yoghurt, body building powder, and animal stock food.

The threat to New Zealand's reputation with Chinese consumers has put the government into over-drive to head off the risk, and it's fast-tracking legislation to allow a speedy inquiry so Prime Minister John Key can front up in China to allay those concerns.

The government investigation is one of four, with Fonterra holding two probes and the Ministry for Primary Industries also holding an inquiry.

Units in the Fonterra Shareholders' Fund [NZX:FSF], which gives outside investors access to the dairy company's dividend stream, fell 0.4 percent to $6.90.

With reporting by BusinessDesk

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