Sachs of money

Goldman Sachs JBWere stands to receive a success fee of up to $15 million from its advisory work on the sale of the New South Wales-based cooperative Dairy Farmers.

According to the cooperative's scheme of arrangement for the $675 million equity sale to the now Japanese-owned National Foods, the Goldmans team led by Christian Johnston is entitled to a success fee that could "fall within range of $5 million to $15 million, depending on the final acquisition price and other factors.”

No further details are revealed in the scheme booklet, which is being sent to the farmer members of the cooperative, who will vote on the sale on November 3.

The success fee will be over and above the $10 million that has already been paid out in advisory fees to Goldmans, along with the legal team led by Guy Alexander of Allens Arthur Robinson, accounting firm PwC and independent expert Grant Samuel.

Executives will also benefit from the change of control, at least in monetary terms. Apart from the $3.2 million paid in retention bonuses over the past two years to a group of unidentified executives, a further $11.2 million is payable to certain executives under payments triggered by a change of control.

The chief beneficiary is CEO Robert Gordon, who joined the company in 2004 but whose employment is automatically and immediately terminated upon the passing of a resolution to change control.

He will receive a total of $3.99 million, being the sum of 24 months base salary at a rate of 1.3 times the base salary of $1.13 million, and entitlements under a long term incentive plan.

Chairman Ian Langdon will receive $531,225 upon ceasing to be chairman, while CFO Luisa Catanzaro will receive a "completion bonus” of $130,418 once the scheme is approved by the court.

What Dairy Farmers describes as "all executives (apart from the CEO) and certain members of the senior management team” will receive a combined $3.5 million under the long term incentive plan, where the targets of growth and rate of return are deemed to have been satisfied in full under a change of control.

A further $3.1 million is payable to those and possibly other executives under the short term incentive plan under a similar arrangement.

The staff who benefit from the scheme are not specifically identified, although the key management personnel, apart from Gordon and Catanzaro, are identified as supply chain chief Gordon Buxton, sources and farm services manager John Bywater, sales head David Hall, corporate affairs manager Lina Melero, strategic development head John Montgomery and marketing and innovation manager John Wardley.