New Plymouth District Council wants to spend $19.7 million to buy the remaining shares in Tasman Farms, the operator of dairy and pastoral farms in the northwest of Australia’s island state.

The council, which already holds about 77.6% of Tasman, has launched a full takeover offering $1 each for the remaining shares.

Tasman shares last traded at 71 cents on Unlisted. The council’s offer values Tasman at just over $85 million.

Tasman this week posted a $566,000 profit for the year to May 31, following a loss of $8.2 million the previous year.

Revenue dropped 24% from $36.6 million to $27.8 million due to falling dairy prices and production decreases linked to adverse weather.

The 23 farms on Tasman’s books produced 4.02 million kilograms of milksolids for the year compared with 4.16 million the previous year.

Farm gate milk prices fell 20% from $6.55kgMS in the year to May, 2009, to $5.34.
However, on the positive side of the ledger livestock values increased following more recent increases in dairy prices.

During the year, Tasman increased its borrowing facilities from Rabobank Australia to $62.2 million from $55.3 million. The additional funds were used for working capital and development costs during the year.

The company is expecting Fonterra-owned milk processor Bonlac Supply Company to pay a final price of $6.21kgMS for the year, which would provide dairy revenue of about $25.4 million for Tasman.