By Robin Lord
STAFF WRITER

3/4/04 An attempt by a group of large cranberry growers to take control of the Ocean Spray board failed Tuesday at the fruit cooperative's annual meeting in St. Petersburg, Fla.

The result was the election of a board that is a mix of those who support and those who oppose pursuing a sale or merger to make the Ocean Spray brand more competitive with multinational drink companies.

It is an issue that has divided the cooperative in the last several years.

Ocean Spray is owned and operated by 800 cranberry growers in Massachusetts, Wisconsin, New Jersey and the Pacific Northwest, as well as about 125 Florida grapefruit growers.

There are an estimated 25 to 50 growers in Barnstable County. Most are considered small.

The cooperative has been struggling the last few years as a surplus of berries drove prices to record lows.

A proxy fight at last year's annual meeting ended in the election of a board that pledged to be more responsive to smaller growers, which includes most in Massachusetts. At the time, they pledged to investigate all possibilities to compete with multinational companies such as Coca Cola and Pepsi - including a sale or merger of the brand portion of the cooperative.

This year, a group calling itself Committee for a Strong Ocean Spray, was formed by some of the cooperative's larger growers, mostly in Wisconsin and New Jersey, who want to keep the company independent.

However, growers, either by proxy or in person defeated an attempt by CSOS at this week's meeting to reduce the board from 12 to 11 members.

If approved, the reduction in members would have prompted the second election in two years of an entirely new board of directors.

Instead, growers went along with the current board's compromise proposal to expand from 12 to 15 directors. Under cooperative bylaws, expansion of the board does not require a clean sweep of the existing board.

The results of the proxy vote are still subject to final review and certification sometime next week.

Two Massachusetts growers were elected to the board: Robert Rosbe, vice president and chief financial officer at A.D. Makepeace Co. in Wareham, and Richard J. Poznysz of Mattapoisett.

In a press release on Tuesday's vote, Rosbe, who is also chairman of the current Ocean Spray board, said his members recommended the expansion to bring additional viewpoints to the board and provide "a platform for the continued growth of Ocean Spray."

The infighting at the cooperative over the last couple years has not been lost on Wall Street. Credit ratings agency Standard & Poor cut Ocean Spray's ratings last month and said it was "extremely concerned by the continued division among the cooperative's membership over its direction."

Hal Brown, a Middleboro grower who hosts a cranberry industry Web site, www.cranberrystressline.com, said a "two-party system" has emerged within the Ocean Spray cooperative.

There's a struggle for power, he said, and a difference of opinion on "the vision of what the juice business is going to look like and how Ocean Spray is going to compete."

Ocean Spray CEO Randy Papadellis had some encouraging news for growers this week. The company's financial performance improved in 2003 with gross sales reaching about $1 billion. He said this should translate into a barrel price to growers of more than $35 for the first time in five years.

But Brown said he thinks that while it is good news the price is on the way up from the rock-bottom price of $10 a barrel a few years ago, the $35 prediction is not high enough for profits.

"Now we're at a level we considered a crisis four or five years ago," he said.