Specialist investment fund Pastoral Dairy Investments (PDI), led by senior New Zealand dairy industry and investment figures, has launched an initial public share offering today.

The specialist investment fund will give New Zealanders the opportunity to invest in funds which will make debt-free acquisitions of dairy farms, aiming to benefit from overseas demand for dairy commodities and the country’s leadership of the international dairy trade.

Pastoral Dairy Investments is offering 25 million shares including oversubscriptions with an issue price of $1.00 per share, partly paid to 30cents per share with a minimum commitment of $20,000. An extra fee of $0.02 per share will be payable upon application.

In conjunction with the offer, institutional and other qualified investors will be able to co-invest directly into farms to be acquired by PDI.

It is intended that, once the funds raised in this offer have been fully invested, application will be made to quote the shares on Unlisted.

Malcolm Bailey, currently chairman of the Dairy Companies Association, a director of Fonterra Cooperative and a member of Washington-based International Food & Agriculture Trade Policy Council, will chair Pastoral Dairy Investments.

John McDonald, chairman of Pohutukawa Private Equity, a Solid Energy and Horizon Energy Distribution director and mid-Canterbury dairy farmer, will be joining Mr Bailey.

Mr Bailey says the specialist investment fund gives New Zealanders an opportunity to invest in what the country does best.

“Our pasture based systems have enabled the New Zealand dairy industry to lead international trade in milk commodities and has made dairy the country’s biggest export earner,” says Mr Bailey.

“DairyNZ’s most recent Economic Survey estimates that New Zealand dairy farmers made a record operating profit last season and that they are back on track to make a similar level of operating profit in the current season. This offer by PDI gives the New Zealand public rare access to an investment aiming to share in that success.”

The investment fund will be managed by partnership MyFarm Asset Management LP which is led by Andrew Watters and Grant Rowan, both directors of one of the country’s largest dairy farm managers MyFarm alongside professional directors Neil Craig and Brian Cloughley.

PDI is based on a variation of a proven private equity structure and it will purchase and develop its initial portfolio of dairy farms without term debt borrowings by either the PDI fund or the farms.