Receivers running the ruler over Crafar farms bids
Receivers for 16 farms owned by former Crafar family companies say that there has been "significant interest" in the properties but it will take them days to sort through the tenders.
Brendon Gibson, from KordaMentha, said assessing the purchase bids would take some time, and he and fellow receiver Michael Stiassny would have no further comment to make until they had made the decision.
Four Crafar companies went into receivership last year owing more than $200 million to PGG Wrightson and banks. They owned 13 dairy farms and three drystock grazing properties in the Waikato, King Country, Bay of Plenty, Wanganui, Taranaki and Rangitikei ranging from 128ha to 1750ha in size.
The receivers signed a sale agreement for the farms in May with entrepreneur May Wang's UBNZ Funds Management – 80% owned by New Zealand-based UBNZ Trustee Ltd and 20 percent by Natural Dairy (NZ) Holdings Ltd – but the deal is conditional on Overseas Investment Office approval. That may take another seven weeks, though an initial assessment is expected to be finished early next week.
In the meantime, Natural Dairy has asked Fonterra to supply it with raw milk to be processed in Tauranga into 150 million packets of longlife heat-treated milk for export to China. Independent rivals of Fonterra can require it to supply up to 50 million litres of milk.
The only other major corporate bidder known to be in the running for the farms is state-owned farmer Landcorp, which has bluntly stated that it probably cannot match the dollars in the Natural Dairy bid – reported to be as high as $230 million – but that its offer will not require regulatory approval.
Landcorp has said it wants the package of all 16 farms.
It has a six-year-old venture with the Wairakei Pastoral partnership – owned by wealthy Auckland businessmen Trevor Farmer, Ross Green and Mark Wyborn – which bought 25,000ha of land from the former Fletcher Forests.
The developers turned 9000ha into dairy farms and Landcorp leases them from the partnership under a 40-year agreement. If the joint 50:50 bid for the Crafar properties is successful, Landcorp and Wairakei will use some of the land and potentially sell off some of it.
Ironically, Wairakei's controversial plans to take 83,000 cubic metres (cumecs) of water from the Waikato River for its original conversions were turned down at the same time as an application by Allan Crafar's Plateau Farms company, which wanted up to 27,000 cumecs per day from the river and another 19,000 cumecs from the Pueto Stream.
At the time, Mr Crafar estimated irrigation could have boosted milk production on farmland north of Taupo from 400kg of milksolids a hectare to 1000kg, but the Waikato Regional Council turned down both applications because of the potential impact on electricity generation.
Landcorp wants vacant possession of three Reporoa farm houses still occupied by Crafar family members. Receivers are expected to take the family to court later this month in a bid to get them out.