A dairy industry economist is warning that Fonterra's financial state is so bad it's at risk of following Westland Milk Products into foreign ownership.
The West Coast dairy cooperative was founded 150 years ago but yesterday in Greymouth, its farmer shareholders voted overwhelmingly to accept a $588 million offer from the Chinese Yili conglomerate.
The sale still requires the approval of the Overseas Investment Office but with Yili already owning a dairy plant in South Canterbury, that is not expected to be a hurdle.
Economist Peter Fraser says the problems that led to the sale of Westland Milk are happening on a much larger scale with Fonterra.
He joins Corin Dann in the Wellington studio.