Crafars and receivers reach agreement: report

Friday 24th June 2011

The Crafar family has reached an agreement with receivers, after a two-year standoff following the collapse of its farming empire.

The agreement, reported in the New Zealand Herald newspaper today, came after receivers had claimed more than $5 million in fees, with legal costs topping $4 million.

Crafar spokesman Vinay Deobhakta said the terms were confidential, but the family was "hugely relieved".

Legal proceedings would now be dropped, he told the newspaper.

The family hoped the agreement meant a Chinese bid for 16 former Crafar farms totalling about 8000 hectares in the North Island, would not go through.

That bid is under consideration by the Government.

Receivers KordaMentha took control of the farms in October 2009 after they accumulated debts of more than $200 million with Westpac, Rabobank, PGG Wrightson and PGG Wrightson Finance.

KordaMentha receiver Brendon Gibson yesterday confirmed to the Herald a settlement had been reached.

Deobhakta said the family had not given up hope the farms might remain in New Zealand hands.

An offer from Hong Kong-based Natural Dairy to buy for around $210 million fell through late last year after the Overseas Investment Office said the application failed the "good character" test, and Government rejected it.

The receivers have accepted a purchase offer from Shanghai Pengxin, also a Chinese company, and also conditional on OIO consent.

The OIO is assessing that application.

NZPA

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