Jeremy Kerr appeared in the High Court in Auckland on Monday.

A threat to contaminate infant milk formula with 1080 was a business ploy to drive sales of a competitor possum poison, the Crown says.

Businessman Jeremy Hamish Kerr, 60, appeared in the High Court at Auckland on Monday after pleading guilty to two counts of attempted blackmail.

Police revealed in March 2015 that Fonterra and Federated Farmers had received threatening letters, along with milk packages that tested positive for the poison.

The letters threatened to contaminate infant formula and other products if New Zealand did not cease to use the poison. It also threatened to disclose the matter publicly.

Kerr, who developed a rival product to 1080 – the cyanide-based poison Feratox – pleaded guilty in December.

On Monday he began a disputed facts hearing as to the details of his offending.

Kerr had initially had his name suppressed but his lawyer John Billington, QC, said his client had agreed his name could be published.

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* Recap: 1080 milk scare investigation

* Protester told police where to find alleged blackmailer

At the High Court on Monday, Crown prosecutor Christine Gordon QC said the disputed facts hearing would centre around what benefit, if any, Kerr expected to obtain from his offending.

She said Kerr had claimed he had nothing against the 1080 pesticide but over the years the eradication of possums had reached a "maintenance" stage and royalties he obtained from Feratox were dwindling.

Gordon said he became "agitated" and came to believe sales of his own product would increase by 30 per cent if 1080 wasn't used.

"His issues with 1080 were of a commercial point of view. Where it was used, Feratox wasn't," she said.

The court heard that Kerr's company developed Feratox, a pellet preferred by possum fur companies because it preserved its fur after death.

Witness statements from former company managers said Kerr had nothing against 1080 as a toxin, and had carried out some developmental work on the poison before moving onto Feratox.

However, they said Kerr became concerned that 1080 was outdoing sales of Feratox, and would ask company managers on a daily basis how Feratox sales were doing.

A co-founder of the company that sold the pesticide said Kerr was "extravagant" and "generous" with his money and described the royalties Kerr received from Feratox as so significant that it drained the funds of the business.

"He would always be dreaming of boats and holidays and would always be spending money. For Jeremy, money was always in the background for everything he did."

He said Feratox could in no way be a replacement for 1080 because it couldn't be aerially dropped, however if 1080 ceased to be sold it could increase Feratox sales.

Fourteen witnesses were due to give evidence over the coming days.

A $3 MILLION INVESTIGATION

* The investigation cost police more than $3 million, and about 35 officers were put on the case.

* More than 2600 people were considered as possible suspects, with more than 60 "significant persons of interest" approached for interviews.

* Orders from our biggest dairy market, China, slumped and the Chinese Government announced no milk powder would be let through until it was tested.

* Every tanker of raw milk processed by Fonterra was tested. All paediatric products and nutritional powders were also tested.

* By the time Kerr was arrested, the Ministry for Primary Industries and manufacturers had carried out 150,000 batch tests.

* Diary farmers said whoever had made the threat was a "coward", amid fears it would harm the industry, already struggling with drought and low prices.

* Despite assurances from authorities, some parents were left stressed and worried, with many turning over tins of formula to police, fearing they had been tampered with.

* Connovation Ltd and Connovation Research Ltd have issued a statement noting that its companies are not connected to any operated by Jeremy Kerr, saying there is an unfortunate similarity in the former names of his companies used at the time of his offence. There is no common shareholding, no common ownership, and no common management between its companies and his businesses, Connovation said. However Companies Office records suggest Kerr was a director of Connovation Research in 2002.