AACo goes it alone

19 Apr, 2013 04:35 PM
Comments
8
 

THE Australian Agricultural Company (AACo) is going alone with construction of its $85 million Darwin abattoir without a joint venture partner.

It will fund construction from its own balance sheet and expects the plant to begin operating late this year.

AACo has just completed stage one civil works for its Top End meatworks with final design and tenders for the next stage of the build now nearing finalisation.

Managing director David Farley said AACo had had numerous discussions with potential joint-venture partners but would only consider such a deal if the other partner brought strategic value to the project.

The big beef cattle business wanted a partner - on acceptable terms - with experience in areas such as logistics or distribution capability.

"AACo is unwilling to consider a pure equity investment from third parties without this sort of strategic alignment," Mr Farley said.

The company's proposed sale of "Brighton Downs" station and the smaller "Adelong" property in Queensland would allow AACo to redeploy capital from non-strategic land assets to higher value-adding beef processing assets in Northern Australia, consistent with its business strategy.

"AACo has received good interest from other northern pastoralists who are willing to commit supply to the abattoir and also from product off-take customers," Mr Farley said.

"The proposed Darwin abattoir will be a transformative project for the northern Australian beef sector, providing a world-class facility to enable product to be shipped to Asian markets faster and more cost effectively."

FarmOnline
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READER COMMENTS

Cocky
20/04/2013 5:39:06 AM

Sounds like a good idea, it's just a shame every farmer in the country can't afford to build his own meat work and finally get a fair cut of the end price. They always say if you can't beat them join them!
Richard the Realist.
20/04/2013 5:56:32 AM

I wish Dick Smith and his fellow Investors in AACo all the best when they view the bottom line that is coming up over the next 24 mths.
peter
20/04/2013 7:15:14 AM

The investors of the AA CO must be very gulable where in the world does it cost 85 million to build an abattoir ,no idea this company.
tender
21/04/2013 10:53:02 AM

Let me know how I can assist practical knowledge wise, my whole life has been within this industry from birth to box.
Bundi
21/04/2013 6:08:30 PM

"The investors of the AACo must be very gullible where in the world does it cost 85 million to build an abattoir, no idea this company." Well I'm one of those investors and am 100% behind the company.
interested
22/04/2013 7:24:50 AM

Madness - our customers to the north in the main do not want boxed meat. Numerous companies have tried and failed in the meat processing sector in Northern Australia. These include some of the icons of the production and processing sector. Glad I am not a shareholder. There is more to being profitable in this industry than processing and selling meat.
themule
23/04/2013 7:49:10 AM

I am amazed that the only ones who can't see this is AA Co. There is a proven track record of failure with meat works in the NT and this will be no different. Stick to growing cattle and support the live trade and get that right rather than try and process and package it won't work. Especially if you are paying $85 Million for the privalige as you are starting way behind the eight ball and have paid way too much to build the works. No wonder the state govt wouldn't support it.
johnny woofl
5/05/2013 1:17:49 PM

Does this company ever get the cash prior to spending it.Leave this investment in an abator until they have the cash. Maybe they would be better to let the managers manage and get back to the grass roots and just produce cattle.

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