Tuesday 16th February 2016 |
Text too small? |
Landcorp, the state-owned farming company, will end its five-year relationship with Shanghai Pengxin next year, saying it wants to focus on other areas of growth and won't renew its sharemilking contract.
Chief executive Steve Carden said that as part of its new strategy, the company is focusing on areas of growth such as its Pamu brands farm products, its investment in a sheep milk JV and wool supply to Danish shoe manufacturer Gleryps.
“Landcorp has worked hard with Shanghai Pengxin and is proud of what the partnership has achieved, turning around 16 poorly performing farms," Carden said. "The Landcorp team on the ground have done a terrific job."
Pengxin entered the New Zealand dairy market with the controversial purchase of the Crafar farms in 2012 and has since added a a 74 percent stake in Synlait Farm Holdings, which has 3,942 hectares of prime dairy farms in central Canterbury, and signed a supply and purchase agreement with Miraka for ultra-heat treated milk for the Chinese market.
But its expansion plans for New Zealand have faltered after the company was knocked back in its application to acquire the Lochinver Station in the central North Island. Another Pengxin unit, Dakang New Zealand Farm Group, withdrew an application to buy seven dairy and three support farms in Northland from Pinny Farms, the region's largest milk supplier, last October. In January, former Fonterra executive Gary Romano resigned from Pengxin.
Landcorp's Carden had been keen on an expanded relationship with Pengxin as recently as 2014, when he described the partnership as "a very positive one" and said he would be keen to discuss a management role for Lochinver if that deal was approved.
The sharemilking contract expires in May 2017. Landcorp would continue to manage the Pengxin farms over the next 18 months "and is committed to ensuring a smooth transition of the properties including stock and staff at the end of May 2017," he said.
The two companies said they wouldn't rule out teaming up again in future.
BusinessDesk.co.nz
No comments yet
EBOS announces appointment of new Chief Financial Officer
AM Best affirms Tower Limited's A- (Excellent) FSR
MCK enters into conditional agreement for Whangarei land
April 26th Morning Report
SPG - Change to Executive Team
BGI - Forgiveness of $200,000 of secured indebtedness
General Capital Subsidiary General Finance Market Update
AFT,Massey Ventures,Gilles McIndoe to develop scar treatmen
April 24th Morning Report
Cheers to many fewer grape harvest spills