Members of a Yorkshire farmers’ co-op have called a meeting in a bid to reject proposals to demutualise and create a private company limited by shares.
Brandsby Agricultural Trading Association (Bata) has been a co-op since its inception in 1894, supplying agricultural and energy products to farmers and the wider rural community and running 11 Country Stores.
Some of its 4,000 members are unhappy with the demutualisation plan and have launched a ‘vote no’ campaign, handing out leaflets in the area.
A group of around 50 members is reported to have called a meeting next Monday (14 August), where a resolution will be put forward to reject the demutualisation plan, requiring a two-thirds majority of those voting.
A second resolution proposes a vote of no confidence in the board and the removal of the current directors from office.
Former chair and farmer member Charles Brader told the Rydedale-based local paper Gazette & Herald: “We believe that if the conversion is successful that Bata will, before long, be either sold or broken up.
“We believe that after 130 very successful years, that it has proved that it can survive and prosper.
“The co-operative society has conducted numerous surveys and found that staff working at a co-operative are often more fulfilled than the private sector.
“We have not been given any convincing reasons to believe that Bata will be better able to compete after conversion.”
“Member rights and future potential benefits would seem to be weakened post conversion.”
He said the co-op’s assets meant it was capable of raising capital, reducing the need to change structure, and criticised plans for a new board that “would not have an active farmer on the board at all and would have a 6-3 split executive versus non-executive”.
“The members of Bata have long standing loyalty and close relationship with the company and care for it, not just as a profitable company but as a provider of services to their community. If the conversion does go ahead they are concerned that it will be just profit lead and feel that it would be detrimental to them and their businesses.”
But Bata executive Andrew Richardson told the paper most members had given a positive response to the plan, and said the move was necessary to allow the business to raise capital.
“We have put forward this proposal to convert from a co-op to a limited company which will open doors to other areas,” he said.
“Unfortunately some people have been misleading others but the majority of people we have spoken to are in favour of the move.
“We also encourage members to contact us directly and we will be happy to answer any questions they have.”
The day after the members’ meeting, the co-op has called a special members meeting at York Marriott Hotel to vote on the demutualisation.
Its resolution to members is that “pursuant to section 112(1)(a) of the Co-operative and Community Benefit Societies Act 2014 and Rule 17.2 of the Society’s Rules, Brandsby Agricultural Trading Association Limited (with registered number IP03289R) (“Society”) be and is hereby converted into a private company limited by shares with the same name and registered under the Companies Act 2006 (“Conversion”) on terms that all members of the Society immediately prior to the Conversion shall become members of the Company immediately after the Conversion.”
The issue of co-ops’ ability to raise capital has been the subject of high-profile campaigning by the movement in recent years, with cases like 2021’s failed demutualisation bid for insurer LV= offered as examples of the need for reform.
Prominent voices in the call for reform include Co-operatives UK, the Co-op Party and Mutuo, and positive steps include the recent passage of Mark Hendrick’s Co-ops, Mutuals and Friendly Societies Bill and a government pledge to reform existing co-op law.
- Bata has been contacted for further comment