Chinese explore Van Diemen farm

14 Jul, 2014 06:00 AM
File photo.
It's no secret that TIML's ­balanced portfolio is out of kilter
File photo.

A CHINESE investor is believed to be in due diligence ahead of buying a $NZ152 million ($142 million) New Zealand-owned portfolio of ­Tasmanian farmland.

The dairy farms are part of the New Plymouth District Council Perpetual Investment Fund and administered by Taranaki ­Investment Management.

New Plymouth councillors were scheduled to visit the farmland, ­collectively known as The Van ­Diemen's Land Company (VDL), in July as part of sell-off negotiations.

Chinese interests were understood to be meeting New Zealand consultants this month as part of due diligence.

Sources had told New Zealand-based Fairfax Media journalists the fund had failed to provide dividends under council ownership and overall profits had been poor.

The Perpetual Investment Fund was set up in 2004 after the council sold a 45 per cent share of Powerco to Australian-owned Prime Infrastructure for $259 million.

The fund was calculated at $NZ203.4 million in 2013. However, a NAB document acquired by The Australian Financial Review earlier this year showed the ­company was $67 million in debt.

NAB has also been in talks to sell its stake in the farmland. However, an oversupply of dairy farmland on the market has failed to lure buyers.

Since its formation, the council has received NZ$20 million in release payments annually.

However, in a bid to rebuild the fund, it will reduce its takings to $NZ10.4 million in 2013-14, $NZ9.4 million in 2014-15 and $NZ8.5 million in 2015-16.

Councillors have described farms as the New Plymouth ­council's most significant asset, accounting for two-thirds of the fund, which has drawn concerns the fund was over-exposed to an under-performing asset.

Despite being defined as a ­perpetual fund, Fairfax has reported the fund has depreciated from $NZ260 million to about $NZ241 million in nine years.

"It's no secret that TIML's ­balanced portfolio is out of kilter; I will be seeing just how close we are to divesting our interests," New Plymouth mayor Andrew Judd said.

On its website, the Van Diemen's Land Company says it owns and operates 25 dairy farms, a dairy support unit and a stand-alone heifer rearing operation.

While there is scope to expand the farms, conservationists have heavily criticised plans for a $180 million expansion to double milk production as threatening the already endangered Tasmanian Devil.

One potential buyer, the Chinese Investment Corporation, has withdrawn from negotiations. It was in talks with former Tasmanian premier Lara Giddings about acquiring an interest in VDL in 2013.

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14/07/2014 8:08:48 AM

The Chinese Investment Corporation must surely be an arm of the Chiniese Government which is buying up our farmland at an alarming rate. When do we stop this invasion or stop selling our sovereignty?
14/07/2014 9:07:21 AM

When Australian family farmers stop selling their farms?
14/07/2014 11:28:34 AM

Percy, maybe you should ask the farmers that question? I haven't heard you criticise the fact that a NZ entity (which also looks to be government owned corporation) currently owns this land.
14/07/2014 12:51:37 PM

Don't worry PERCY, people still seem to have a problem understanding state backed money (esp the next worlds reserve currency) has no accountability. How many of them are out there doing audits on our govt? not many I expect. Plus, like the banks, there is no data, if we don't know the facts how can we affect change? (hint, the total lack of data on banks and farming as well as foreign purchases of farms is no coincidence).
Boonah Bob
14/07/2014 2:06:29 PM

Until the governments of the day realize that farmers are no different than wage earners who are protected by legislation as to the minimum amount they have to be paid for a days work. They can and will sell THEIR property to the highest bidder no matter who they are. All the farmers want is a survivable living i.e. a minimum sustainable price for their contribution to the economy of this country.
14/07/2014 2:37:25 PM

Boonah Bob is the one here making real sense on this question. Facts are that our farmers have no alternative but to sell to the highest bidder, no matter what origin that buyer has. After all, the Government feels happy to let this happen, while taking a much more protective view of labourers, and stupidly burdens farmers and all businesses with economic and social regulations until they are so unprofitable they have no choice but to cash out to whoever pays. Farmers alone will keep doing so until Govt wakes up or it is too late and we are all tenants/servants in our own home.
Bushie Bill
15/07/2014 10:41:29 AM

"If (you) don't know the facts" wtf, how can you make any judgement at all, or is it simply a fact that ignorant prejudice is perfectly ok?
Bushie Bill
15/07/2014 10:53:25 AM

Boonah Bob, GFA et al, farmers ARE different to wage earners. They are supposed to be business operators, not lifestylers expecting Australian taxpayers and consumers to subsidise their chosen lifestyles while they contribute less to society than they consume. Only when RARA grows a brain and learns agriculture is just another industry, totally dependent upon successful operators for a future, will they then get off their collective acre and manage their assets in exactly the same way as any successful business operator i.e. at a profit. Nothing prevents this other than laziness and apathy.
15/07/2014 10:57:45 AM

How come other industries have lots of data, the real estate industry has heaps, they can tell u how many houses sold on the weekend and how many above reserve. We know nothing about ours, is that not deliberate? if we knew a lot of bankruptcies occurred in the live export industry post shut down, would govt have been more accountable? There is no prejudice in my comments, just suspicion the gov't and banks lack of available data is deliberate? are u criticising me for wanting to be informed by data rather than be ignorant? (cue agsoc, redneck, etc)
15/07/2014 11:33:56 AM

Some farmers are now forced to sell to the highest bidder because they were the highest bidder when they bought it.


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