Crafar receivers line up new Chinese buyer for farms

Thursday 27th January 2011 1 Comment

Receivers for the Crafar family's four companies have canned a sales agreement with a Chinese-backed investor - and announced a new offer from another Chinese company, Shanghai Pengxin International Group.

"We have accepted an offer from Pengxin International Group," said one of the receivers, Brendon Gibson of KordaMentha. "It's the best offer we have."

The receivers were now waiting on an Overseas Investment Office approval, which was expected in March.

Gibson, said the receivers no longer had a deal with the previous group of Chinese investors, who were using a mining company rebranded to Natural Dairy NZ Holdings to buy the farms through a New Zealand company, UBNZ Funds Management.

Two cabinet ministers, Maurice Williamson and Kate Wilkinson last year declined consent for Natural Dairy's application because they were not satisfied that all the individuals with control of Natural Dairy were of good character.

Natural Dairy tried to protect its deal earlier this month by pushing the terms of settlement for the purchase of 16 farms in receivership out to September 30 this year. It told the Hong Kong stock exchange that its advisers needed time to consider the rejection of its bid.

"Although the applications were declined by the ministers, the company is considering sourcing the milk and manufacturing the finished dairy products in New Zealand for export into the Asia market," said company chairman Wu Nengkun.

Shanghai Pengxin said today that it would make a full disclosure of its plans when it lodges its OIO application in March. Its total assets were about $US2 billion ($NZ2.58 billion), in property development, infrastructure, mining and agriculture, said company chairman Jiang Zhaobai.

The company owns 650 hectares of farmland on Chongming Island near Shanghai, used for sheep, wheat and soybeans, and had another 930 hectares in Shandong Province for a sheep farm.

In 2005, the company invested more than $US20 million in a Bolivian soybean and corn farm, it had agricultural interests in Cambodia and Argentina, and was negotiating to buy 200,000 hectares of land in Brazil to grow soybeans and cotton.

NZPA

Comments from our readers

On 28 January 2011 at 4:44 pm christopher said:

Stop right there. How does selling a productive, foreign currency earning asset like dairying work in NZ's favour ? It doesn't and you can be certain that this is the thin edge of an acquisition wedge. Why did the Chinese want major investments in mining - to bring down prices to the Chinese manufacturers. Can NZers buy land in China ? I thought not.