Crafar farms base for growth by Chinese richlister 27 Jan 2012
- Green Cross annual profit falls 4.1% on higher staff costs Business
- UPDATE: Scott Technology cuts 13 jobs after 'busy' 2014: CEO Business
- Minister welcomes new venison PGP programme News
- Scott Technology cans 13 staff, moves to more temps: EPMU Business
- 2degrees posts reduced loss of $33.6M, will launch UFB soon Business
- UPDATE: FMA gives NZX clean bill of health on oversight Business
- Chorus says RMA fix needed to aid fibre rollout Business
- Budget 2015: Funding boost for Irrigation Acceleration Fund News
- UPDATE: Tower shares gain on dividend, 1H earnings Business
- Orion Health reports $61M loss, revenue beats prospectus Business
The purchase of 16 farms in New Zealand is a base for expansion in dairying by Jiang Zhaobai, one of China’s wealthiest men, according to the Overseas Investment Office (OIO) decision.
The OIO recommended the sale of the so-called Crafar farms to Shanghai Pengxin Group (SPGL) and associated companies and Associate Finance Minister Jonathan Coleman and Land Information Minister Maurice Williamson have approved it.
The sale by receivers KordaMentha has stoked anti-foreign investment sentiment and a rival consortium led by New Zealand businessman Michael Fay is promising a legal challenge.
The OIO decision does not reveal the sale price but says the buyer wants to invest more in New Zealand and will spend more than $NZ100 million in the next five years to promote New Zealand diary products in China.
SPGL has extensive business interests and is owned by Nangtong Yingxin Investments, a Chinese company owned 99 percent by Zhaobai Jiang and his brother Jiang Lei owns 1 percent.
Jiang Zhaobai is a Chinese and Hong Kong citizen. The professional engineer founded a real estate construction company in 1988 and is listed on the 2010 Forbes List as the wealthiest person in China.
The OIO decision says he intends to identify dairying and processing operations in New Zealand which may be appropriate for partnerships.
He does not want to build or own milk processing plans but may invest with joint venture partners in expanding capacity if it is required.
He intends to increase production at the Crafar farms, which have suffered from under investment and poor pasture quality, by investing $NZ15.75 million in the first two years. A breakdown with spending blanked out includes investment in effluent systems. The production goals in a business plan are also blanked out in the decision.
The new owner intends to sell its milk to dairy co-operative Fonterra. The size of the shareholding acquired in Fonterra via farm ownership is blanked out.
“The applicant would be interested in offering expertise from China to collaborate to develop new dairy products for the Asian, and particularly the Chinese, market such as baby formula.”
This decision suggests processing would be in New Zealand.
Jiang Zhaobai is also investing in a farm school on one of the acquired farms to be operated by New Zealand’s state-owned Landcorp, which will manage the farms purchased.
Landcorp will also help develop the applicant’s sheep business in China.
The applicant submitted that a refusal of his application may adversely affect New Zealand’s trade relations in China. The countries have a free-trade agreement.
“SPGL is a credible and well respected business in China with strong business acumen and ability,” the OIO said.
The new owner has to provide public walking access to some areas.
A joint venture owned 50 percent by Landcorp and 50 percent by the Chinese acquirer will develop and manage the farms. Landcorp is a provider of farm management services.
Forbes has Jiang Zhaobai as the 284th richest person in China.
23 May 2015 News
Foreign Minister Murray McCully has welcomed the news that two well-known illegal, unreported and unregulated (IUU) fishing vessels,... more
22 May 2015 News
22 May 2015 The Budget confirms $6.1 million in operating funding over the next four years and $13 million of capital funding from... more
22 May 2015 Business News
May 22 (BusinessDesk) - New Zealand consumer confidence slipped in May as sentiment about current and future conditions eased. The... more
23 May 2015 Lifestyle
The pride and glory of winning The Ultimate Waterman is relived for Kiwi Daniel Kereopa in a documentary that went live online this... more
22 May 2015 Property
Building and Housing Minister Dr Nick Smith today released at the Certified Builders’ Association conference in Christchurch... more
20 May 2015 Property
Goodman Property lifts FY earnings 5.4% on revenue growth, cost clamp down May 20 (BusinessDesk) - Goodman Property Trust,... more
30 Apr 2015 Migration
The Immigration Amendment Bill (No 2) which cracks down on employers who exploit migrant workers passed its final reading in... more
21 May 2015 Travel & Tourism
New Zealand Government Hon Nathan GuyMinister for Primary IndustriesHon Nicky WagnerMinister of Customs 21 May 2015 Border clearance... more
23 May 2015 Cricket
DAY THREE First Innings: England 389 (Root 98, Stokes 92, Buttler 67, Ali 58; Henry 4-93, Boult 4-79) v BLACKCAPS 523 (Guptill 70,... more
22 May 2015 Cricket
First innings at stumps on Day One: England 354-7 in 90 overs (Root 98, Stokes 92, Buttler 67, Ali 49*; Henry 3-93 on Test debut) DAY... more
22 May 2015 Opinion
From the outset, the slogan for yesterday’s Budget - “The Plan Is Working” – begged to be mocked.... more
30 Apr 2015 Opinion
For the past week or so we’ve been hearing a lot about the child-like side of our Prime Minister. So I guess we... more
21 May 2015 People
Sixteen-year-old Waikato Dio student Nikita Lyons is one of four students representing New Zealand at the International Biology... more
15 May 2015 State of the Market Report
NZ's growing ICT sector drives rapid economic diversification, Joyce says May 15 (BusinessDesk) - New Zealand's information... more