Fonterra scotches report Spierings tipped to step down

A report in The Australian newspaper today says Fonterra [NZX: FSF] chief executive Theo Spierings is about to step down and Air New Zealand [NZX: AIR] chief executive Christopher Luxon is his most likely replacement.

Fonterra has categorically denied the report.

"There is no substance to the rumour," a Fonterra spokesman said. "Our response is absolutely and categorically no."

When asked by NBR three weeks ago if he had been approached by Fonterra, Mr Luxon said he would not comment on speculation.

The report in The Australian's Dataroom column quotes "sources close to Fonterra" as dismissing the suggestions. However, the report goes on to say "speculation has emerged in the past month on both sides of the Tasman that Mr Luxon has been earmarked as the next Fonterra boss, with a departure by Mr Spierings, who has 30 years' experience in the industry, said to be close."

Mr Spierings has headed Fonterra for about five years. The report links the speculation to Fonterra’s Australian arm falling into loss, triggering a sale of its Australian yoghurt and dairy dessert business to Parmalat Australia in a quest to return it to profitability.

It also says the talk of his departure comes after Murray Goulburn chief executive Gary Helou recently left the Australian dairy co-operative following a shock profit downgrade.

The dairy industry on both sides of the Tasman is under pressure from low milk prices and payouts that make many dairy farms unviable.

Mr Luxon has been seen as somewhat of a star performer at Air New Zealand, which has seen its market value almost triple in the three years he has been running the airline.

The report does not note Mr Luxon's previous background in consumer goods company Unilever.

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