The James M Covert Revocable Trust of the
However, the OIC rules,
Queenstown’s Mountain Scene, in a front page
story (“Billionaire’s Home Sweet Home”, by Kevin Thomas, 31 October – 6
November) tells us more. Covert is a “cashed-up double billionaire”, having
made his money in security (how appropriate). Last year, he sold his company
to the Tyco Corporation for US$1.05 billion (about $2.1 billion) – “all
cash”. (In Aotearoa, Tyco owns Wormald, Armourguard, and Rhino security
companies, plus several manufacturing operations – see our commentary on its
takeover of Rhino Security in January 1999. Though a
Fletcher Challenge Forests Limited (FCF), which is 42.314% overseas owned (see below for details) has approval to acquire the business and assets of the Central North Island Forest Partnership (in receivership) for “approximately US$650,000,000” (approximately $1.4 billion) from the Partnership. In fact the purchase never took place because insufficient FCF shareholders supported it.
Partnership is a 50/50 one between CITIC New Zealand Limited (in
receivership), owned by the Chinese Government, and Forestry
The heart of the Partnership is the huge Kaingaroa Forest, one of the largest plantation forests in the world, which was created by the government starting in 1901, and accelerated in the 1920’s and 30’s. However the partnership owns land in other areas too, its assets being essentially the holdings of the privatised Forestry Corporation. Its ownership and management of land, forests and other assets is as follows according to the OIC:
· management of 183,898 hectares of plantation forests, approximately 99% of which is held under Crown Forestry Licences; and
1,844 hectares of
freehold land situated
in the Whakatane, Rotorua, Tauranga, Mt Maunganui, Taupo and
48 hectares of
leasehold land at
· processing plants at Waipa, Kaingaroa and Mount Maunganui producing wood products such as structural Douglas fir lumber, Australia and New Zealand appearance grade lumber and solid and finger-jointed blanks, mouldings and laminates, panel products and door cores.
In explanation of the need for the transaction, the OIC says coyly that “the partnership was been placed into receivership as a result of a commercial dispute between the partners.”
The Partnership, which originally included Brierley Investments Ltd (BIL), was formed to buy the forests when the Forestry Corporation was privatised amidst huge controversy just before the 1996 elections. It consisted of Citifor Inc. (37.5%), Fletcher Challenge Ltd (through its forestry division, Fletcher Challenge Forests Ltd, 37.5%), and BIL (25%). Citifor was a subsidiary of CITIC USA Holding Inc., in turn a subsidiary of China International Trust and Investment Corporation (CITIC), a Chinese state-owned corporation. The Partnership purchased the Corporation’s assets for $2.026 billion, though the government had to use $426 million of that to repay the Corporation’s debt. For more details, see our commentary on the September 1996 OIC decisions.
BIL was given an option to sell its 25% stake after three years to FCF for the market value of 93.3 million FCF shares, to be paid in cash or shares. FCF in turn could force Citifor to buy half BIL’s holding for cash. BIL exited in 1998 (see our commentary on the September 1998 decisions), with CITIC and Fletchers each taking half its share of the venture.
BIL’s reason was its own increasingly desperate financial situation. However,
even at that stage, the Partnership was clearly in trouble. In July 1998 the
Partnership announced it was negotiating to restructure over $1.2 billion of
debt (raised to buy the Corporation) after its Douglas Fir prices collapsed.
The Partnership’s “cash flow forecasts were based on heavy early harvesting
of the former corporation’s Douglas Fir crop. Unfortunately harvesting had to
be reduced when Douglas Fir prices collapsed. The 12 banks involved have been
kept aware of the situation.” (New Zealand Forestry Web server,
the Partnership had dissolved into increasingly public acrimony, after Citic
accused Fletchers of selling the logs too cheaply to Fletcher Challenge Paper
mills, and it went into receivership in February 2001 to the apparent relief
of all parties (except the banks), having failed to make payments on its
$1.48 billion debt to an international syndicate of 12 banks. The dispute was
reportedly largely over how much of the processing of logs should be done in
Aotearoa and how much it should be simply exporting logs to be processed in
By then, too Fletcher Challenge was breaking up, with FCF one of its remnants.
The same concerns – processing in Aotearoa, and debt levels – were foremost amongst the matters heatedly and very publicly debated by FCF’s shareholders. They were principal reasons for them voting down the FCF directors’ recommendation to buy the Partnership’s assets as approved in this OIC decision. Analysts and shareholders were concerned at the debt levels being heaped on Fletchers, especially given the usual fluctuations in log prices.
was an additional factor: Chinese ownership. The proposed deal (not reflected
in the OIC decision except perhaps in a bland statement that “the Applicant
may bring in a joint venture partner or on sell a portion of the assets to
fund part of the purchase price”) was that CITIC, through an approximately
40% owned Hong Kong-listed, Bermuda-registered company, South East Asia Wood
Industries (SEAWI), was going to buy 35% of Fletchers through an issue of new
shares. SEAWI’s forestry experience appeared to consist of a small
loss-making plywood mill in
were added complexities to the deal. FCF would have bought out the 17.6%
shareholding of its largest shareholder, Rubicon (another Fletcher Challenge
remnant), at a premium price of 37 cents, an almost 50% premium to the going
price around 24 cents. Despite that, a significant Rubicon shareholder which
was about to make a bid for control of Rubicon, Ron Brierley’s U.K.-based
Guinness Peat Group, was taking court action to prevent the deal. So was the
U.S.-owned Xylem Fund, FCF’s second largest shareholder with 7.3%. It was
concerned that the price being paid was too high, and at the favoured
treatment being given to Rubicon. It placed prominent advertisements in
newspapers and sent letters to all FCF shareholders urging them to vote
against the purchase. (New Zealand Herald,
The fiasco leaves FCF management badly bruised, and the Partnership still in receivership. In September, its chief executive, Terry McFadgen announced his retirement as from April 2003. There were suggestions that FCF might try a third time. But one of New Zealand’s most prominent and experienced forestry consultants, John Groome, suggested that the government should be prepared to take a stake in the forest to block overseas ownership (Press, 30/9/02, “Forests to deliver long-term gain”, p.B4; 1/10/02, “Tall timber goes”, p.C2).
According to OIC, FCF is owned as follows:
7.3% - Xylem Fund
· 2.2% - Other overseas shareholders
· 57.686% - Aotearoa
Trans Tasman Properties Limited, owned 54.8% by SEA Holdings Limited of Hong Kong, 6.32% by Grantham Mayo Van Otterloo and Co of the U.S.A., 4% by “Unknown Overseas Persons”, and 34.88% in Aotearoa, has approval to acquire 35 hectares at Montgomerie Avenue and George Bolt Drive, Mangere, Auckland for $12,000,000 from Manukau International Ltd of Aotearoa.
property is near the Airport Oaks subdivision, near
is located in the Airport Oaks precinct which
contains significant industrial warehouse buildings and associated commercial
office premises. The area has attracted and continues to attract businesses
who require ready access to
The Applicant proposes to develop the sites by undertaking earthworks for roading and site development, kerbing and roading, and installation of services including electricity, telephone, gas, water and sewerage. The Applicant intends to retain up to 20% of the sites as part of its own investment portfolio. In relation to these sites the Applicant will construct commercial/industrial buildings for tenants upon obtaining leasing commitments. The Applicant proposes to market up to 40% of the developed sites to third party industrial complex developers. It is likely the remaining 40% of the sites will comprise a mixture of sites being retained within the Applicant’s portfolio and sites onsold.
Trans Tasman has been in chronic trouble for several years, and sold off 17 properties worth $196 million in Aotearoa in the last 12 months, according to its Stock Exchange announcement of this purchase (9/7/02, “Trans Tasman Purchases Strategic Airport Commercial Land”, http://www.ttp.co.nz/PDF/090702.PDF).
Diversified Property Trust has approval to acquire 35 hectares at
a diversified property trust whose major sectorial
exposure is to the Australian office and retail markets. It is one of the
oldest listed trusts in
The proposal will enable AMP New Zealand Property Retail Limited, which is an associated company of the Applicant, to free up capital which will reduce its financial exposure and provide it with capital to pursue further investment opportunities.
According to AMP Henderson Global Investors (NZ) Ltd, AMP NZ Property sold 50% of Lynnmall Shopping Centre for $65.2 million. A second stage was to sell 50% of Botany Town Centre for $98.3m and 50% of Manukau Supa Centa for $24.6m, subject to AMP Diversified Property Trust unit holder approval. AMP Henderson said that AMP NZ Property “is one of New Zealand’s largest property trusts with over $500 million invested in office, industrial, retail and hotel property”, and that AMP Diversified Property “is one of Australia’s largest shopping centre owners, with 12 shopping centres currently under management” (20/8/02, “AMP NZ Property Fund Sells 50% Of Three Retail Centres”, http://www.amphenderson.co.nz/News/RetailProperty.pdf.)
Navire Holdings Limited, owned 50% by A Fellmann of Luxemburg, 33.33% by F Vladi of Germany, and 16.67% by G Thiel, also of Luxemburg, has approval to acquire the commercial property, “Mobil on the Park”, 157 Lambton Quay, Wellington for $74,250,000 from Midland Tower Company Limited.
According to the OIC,
The beneficial owners of the Applicant have made a
strategic investment decision to acquire a portfolio of quality commercial
investment properties in
The proposal is part of the vendor’s intentions to focus on its core business being property development and not long-term property investment.
Tower Company is owned 25.3113% in the
1997, a subsidiary of
in a media release on
has secured a conditional sale of its
inconsistent with the price and the higher price offered by
Newco (Pohuenui), owned 37.5% each by A Fellmann and G Thiel of Luxemburg, and
25% by F Vladi of
The Applicant proposes to acquire the property known as
Mr Vladi, one of the shareholders of the Applicant owns
a homestay operation on nearby
fact had a previous interest in Pohuenui and is an associate of the previous
owner. In December 1989, Farhad Vladi, John Zollinger Miller, and Ingrid
Kathmann-Broring (sic) from
Through his company, Vladi Islands Travel, Farhad Vladi
specialises in group tours to exotic places. He is conscious that
In January 1991, Delta Agriculture Ltd, owned by F. Vladi, J.Z. Miller, I. Kathman-Broring and Dieric Broring, and registered in Liechtenstein, gained OIC approval to buy Pohuenui Station and Island Resort Ltd, which was by then owned by the same shareholders, for zero consideration. Then in July the same year, Pohuenui Station and Island Resort Ltd was given approval to acquire 99% of the shares in Prosaic Developments Ltd, 24% owned by Vladi (then of Canada), for $110,000. Prosaic owned an adjacent 15 hectare block of land, which was accessible only from the sea.
Islands Travel is more than a travel agency. Its web site, http://www.vladi.de or http://www.vladi-private-islands.de,
specialises in islands, advertising islands for sale or rent. On
1998 Time report began, “Farhad Vladi boasts a distinctly
unconventional occupation: he sells islands. In more than 25 years in the
business, he has sold 620 of them in over 30 countries. His clients have
included actor Tony Curtis, the family of the former Shah of
“Vladi is frustrated, however, by the restrictive
policies on foreign ownership of islands that some Asian countries maintain,
although he is cheered by reports that the
Hotels Internationale Pte Limited of
Duxton hotels in
In a decision
originally almost wholly suppressed, but released on appeal in November 2002,
Works Infrastructure Ltd, owned 50% in Australia, and 50% by Paul Y ITC Construction Ltd of Hong Kong, has approval to acquire
the business assets and undertakings of Pauanui
Lake Resort Ltd (In Receivership) for an amount that is still suppressed.
The assets include 95 hectares at
The property is being developed into the Pauanui Lakes Resort and Country Club, “which will be completed in two stages”. It will comprise “a residential subdivision containing 153 lots (the majority to be low density), an international standard 18 hole golf course, and a 120 room resort hotel including health spa and conference facilities. Future development of 51 chalets and a driving range may be undertaken depending on financial feasibility. “Works Infrastructure already “has made a considerable investment in the property to date as a contractor and is seeking to realise that investment through the purchase of the business”.
Pauanui is designed as an exclusive holiday ghetto for the rich and would-be rich, but has made the news mainly for its financial problems and the dominance of its jet skis.
to Queensland Homes Limited of
proposes to acquire the subject property which is
currently bare land which is part of a larger subdivision by the vendor. It
is proposed that the vendor will carry out the subdivision in four stages
over a 25-month period and at the completion of each stage sell the sections
to the Applicant. The Applicant during that time will attempt to fund each
stage purchase by pre-selling the developed sections and then start
constructing houses, four at a time on the sold sections. The Applicant
advises that the sale and construction timeline will be up to 36 months. The
proposal represents the first investment in the
Construction Limited, owned by the Tiong Family of
propose to add this land to the company’s portfolio of
residential subdivision land in the
The company is active in residential subdivision in Auckland. Its last such purchases were in May 2002, and before that in April and August 2000 (see our commentaries for those months).
Fletcher Residential Limited has approval to acquire 12 hectares at Gollan Road, Mt Wellington and College Road, St Johns, Auckland for $42,342,500 from Landco Mt Wellington Limited of Aotearoa. Fletcher Residential
intends to acquire the subject properties to construct residential dwellings on the land. The acquisition is viewed as an expansion of the residential subdivision and building business of the Applicant in the Auckland region. The Commission is advised that the Applicant has over the last 18 months concentrated its business on residential housing development rather than residential land subdivision. The vendor is completing the necessary infrastructure for both subdivisions.
Fletcher residential is owned as follows, according to the OIC:
12.7% - Australia
9.3% - U.K.
8.7% - U.S.A.
8.3% - Unknown Overseas Persons
2.7% - Hong Kong
0.6% - Japan
57.7% - New Zealand
New Tel Limited of Australia has approval to acquire Digiplus Investments Limited for a sum “To be advised” from the shareholders of Digiplus Investments Limited, Kildare Assets Limited and Nordan Limited, each with 50% of Digiplus, and both from Australia.
According to the OIC,
The Applicant is an Australian telecommunications carrier providing a complete range of services in Australia including local, national, international and mobile telephone, data, and internet networks. New Tel has established a comprehensive telecommunications network and operational support infrastructure throughout Australia and has a national retail presence with offices, dealers or agents in every capital city and many major metropolitan cities in Australia. It currently has no business activities in New Zealand.
Digiplus’s main business activities occur in Australia, where it offers local, national and international and mobile telephone calls and internet services, targeted at Australian residential customers. In addition, Digiplus operates in New Zealand offering national and international calls and calls to mobiles. These services are targeted at New Zealand residential customers.
The proposed acquisition of Digiplus will consolidate New Tel’s position as a major telecommunications carrier, fast tracking growth and strengthening its presence in the New Zealand, Australia and the Asia Pacific regions.
In an announcement to the Australian Stock Exchange (17/6/02, http://www.newtel-limited.com/Newtel/asxRel/asxRel_170602.html), New Tel stated that it was buying Digiplus and associated companies in Australia and Aotearoa, confirming an announcement made in March, but still subject to a number of conditions, including “due diligence in relation to Digiplus’ New Zealand subsidiaries, prior to determining whether to proceed with the acquisition of those companies”. New Tel’s announcement said that:
The purchase consideration for Digiplus is A$40 million in cash and A$10 million in ordinary shares in New Tel, subject to certain adjustments and related indemnities. An initial cash component of A$11.5 million will be financed from a placement, with the remaining A$28.5 million to be paid in three tranches over a 15 month period and proposed to be funded from ongoing cashflow generated by the Digiplus business.
… As a result of this transaction New Tel expects to double its customer base to around 300,000 and increase revenues to approximately $250 million per annum.
Digiplus is a reseller established in Australia in 1997 offering competitive local, national, international, mobile calls and internet services. The Digiplus business has a strong strategic fit with New Tel with both companies providing innovative products and services specifically targeted at migrant communities. In addition the acquisition opens up opportunities to provide further services to New Tel’s other target market niches of community, cultural and sporting associations.
Juken Nissho Limited, owned 85% by Juken Sangyo Company Limited and 15% by Nissho Iwai Corporation, both of Japan, has approval to acquire 1,998 hectares of freehold at Waipiata, Kawera, and Rakau forest blocks, south of Gisborne for $2,650,000 from Nuhaka Farm Forestry Fund which is ultimately owned as follows:
· 13.7437% - Xylem Fund ILP, U.S.A.
· 1.3033% - Hambrecht and Quist Guaranty Finance LLC, U.S.A.
· 4.1172% - other shareholdings in the U.S.A.
· 2.9916% - Laerenes Pension, Denmark
· 2.9916% - Danske Civil OG Akademiingenicerers Pensionkasse, Denmark
· 74.8526% - New Zealand
The OIC says:
Nuhaka Forestry Fund is a “group investment fund” listed on the stock exchange. The Trust Deed requires the Investment Fund be terminated on 21 December 2008. This requires the assets to be cashed up (forest harvested and land sold) with all proceeds being returned to unit holders. The trustee of the fund does not have a mandate from the unit holders to re-establish the forest apart from a small area of 133.4 hectares which was a condition of the resource consents obtained for harvesting the existing trees. Accordingly, the assets of the fund were put up for public tender. The Applicant [Juken Nissho] was the successful tenderer.
The property is adjacent to an existing forest over which the Applicant holds a Crown Forestry Licence. The vendor will retain a forestry right over the original tree crop until these are harvested.
The Applicant will undertake a replanting programme, as the land is released following harvesting, commencing in the winter of 2002. The acquisition will secure a supply of wood to the Applicant’s existing Gisborne processing mill ensuring continuity of processing and employment at the Gisborne mill and for future expansion of value-added production at Gisborne.
According to Datex the current land valuation was $2.4m, so Nuhaka made only a small profit on the deal. The forest is close to maturity, and Nuhaka began harvesting in October 1999 but made a loss in 2001-2 due to low log prices. Harvesting actually stopped in May 2001 due to the low prices. It restarted only in March 2002 when log prices began to rise again.
Nuhaka’s largest shareholder is Evergreen Forests Ltd, with 29.62% of the Fund’s shares. The next largest has only 3.64%. According to the OIC in July 2001, Evergreen is controlled by Xylem Fund ILP (46.6%), and its remaining shareholding consists of 4.4% by Hambrecht and Quist Guaranty Finance LLC of the U.S.A., 19.9% in listed shareholdings Denmark, 16.9% in listed holdings in Aotearoa, 11.7% in listed holdings in the U.S.A., 0.5% in Australia, and 0.2% in Hong Kong. That made it 83.1% overseas owned and 62.5% owned in the U.S.A.
JPS, owned by the Soper and Wheeler Families of the U.S.A., has approval to acquire 3,512 hectares at The Doone, Inland Road, Waiau, North Canterbury for $4,218,750 from DC Carter, PA Phipps, BA Phipps and Hyde Park Limited. The land will be converted to forestry.
DC Carter is presumably David Cunningham Carter, National list MP, and the party’s spokesperson for Agriculture and Associate Spokesperson for Finance. According to the New Zealand Companies Office, he is the sole director of Hyde Park Ltd, of which his wife, Heather, owns half the shares. He owns the other half jointly with Michael Sweeney of Christchurch.
According to the OIC, JPS
is part of a group that has been part of the California forest management scene since early in the 20th century. It currently manages 40,000 hectares in California. The group’s principal activity is the harvesting and management of trees for sale in the forest products industry.
The proposal is consistent with the Applicant’s investment strategy of expanding its forestry interests in New Zealand. The Applicant intends to own and manage the properties that it acquires. A feature of its investment strategy is the intention to invest in a range of species other than radiata pine, having had a long experience with a diverse range of commercial species in California including Douglas Fir, Californian Redwood, Ponderosa Pine, Incense Cedar and White Fir. The Applicant claims that these species grow well in New Zealand and command values many times higher than equivalent grades of radiata pine.
The Applicant intends to initially develop a commercial forest of douglas-fir planted on 2,100 hectares of the property. A total of 3,100 hectares are deemed to be plantable and the remaining areas are likely to be planted dependant on resource consent. Until these remaining areas are planted the Applicant will lease the unplanted areas to the existing farming operation. It is likely that the remaining areas of the property will ultimately also be converted to forestry with redwood, radiata pine and/or Corsican pine being planted.
The subject property is only four kilometres from an existing property acquired by the Applicant. This acquisition is likely to provide management synergies and provide approximately 3,600 hectares of commercial forestry in the region making the Applicant the second largest forestry owner and investor in the North Canterbury region.
The last purchase by the Soper-Wheeler family was in June 2002 when their company JPS II received approval to acquire 416 hectares at Okota Farm, Agnews Road, Hunterville, Manawatu for $775,000.
Their last purchase in the South Island was in February 2002, when JPS received approval to acquire 2,082 hectares at Waihi Gorge, Geraldine, South Canterbury for $1,629,000. This was the fourth acquisition by the Group: in August 2001, it bought 1,278 hectares at Hokonui, Southland; in December 2001 it bought 1,189 hectares at Clutha, Otago; and January 2002 it bought a 4,146 hectare station at Conway Hills, North Canterbury. See our commentary for those months for further details.
It is presumably the Conway Hills property that is close to the new acquisition.
· Three groups of investors from Taiwan have approval to acquire land at State Highway 22, Te Akau Road, near Ngaruawahia, Waikato from the New Zealand Forestry Group Limited, which is owned 76% by Wesley Garratt of Aotearoa and 24% by J Hong of Taiwan. They are all members of the Brooklands Forest Group, which “has entered into an arrangement with New Zealand Forestry Group, to develop approximately 1,200 hectares of land at Ngaruawahia”. They are:
· The Li Wu Hung Family Trust, 15 hectares for $97,280;
· The Yeh Chi Wu Family Trust, 15 hectares for $98,560; and
· Su-Ling Huang, 19 hectares, for $120,320.
These sales are like many in this and other regions organised by New Zealand Forestry Group, the last such sales being in June 2002, also in Ngaruawahia, with investors in the Brooklands Forest Group. The investors provide the money, while New Zealand Forestry Group manages the development of the forestry operation.
· Blake Family Vineyard Limited, owned by Mark Blake of the U.S.A., has approval to acquire 0.65 hectares at Gimblett Road, Hastings, Hawkes Bay for $100,000 from C J Pask Winery Holdings Limited of Aotearoa. “In June 2000 the applicant received approval to acquire 9.8351 hectares of land at Gimblett Road, Hastings. The property is a vineyard. The owner of an adjoining property has now offered to sell to the applicant approximately 6,500 square metres of land that adjoins the applicant’s existing property. The land comprises two narrow strips, which are approximately 10 metres in width. Historically the land has been used to provide access to the neighbouring properties. However, these properties now have alternative road access. Accordingly, the subject land has no ongoing commercial value to the vendor. As the land adjoins the applicant’s existing viticultural operation and under an ‘easement’ arrangement contains some infrastructural assets, for that operation the applicant considers the land to be of a commercial value. The Applicant is currently redeveloping parts of the adjoining property including replanting older portions of the vineyard. It is proposed as part of the redevelopment to expand the vineyard operation on to the land being acquired.”
The Blakes have increasing land holdings in Aotearoa. The previous OIC approval was in July 2001 when Poronui Ranch Ltd, owned by Mark Blake gained approval to acquire the 121 hectare “Poronui Ranch”, 44 km from Taupo, Waikato, for $4,450,500 from Poronui Station Ltd, which was owned 56% by him, 33% by Wendy Margaret Blake, and 11% by Todd Austin Blake, both relatives resident in the U.S.A. “Poronui Ranch” adjoins the 6,334 hectare Poronui Station, also owned by the Blakes, acquired in June 1998 from Carter Holt Harvey. When Blake Family Vineyard Ltd gained OIC approval to acquire the 9.8 hectares mentioned above by the OIC (for $1,350,000), Blake intended to use the grapes to produce its own branded premium wine for use at “Poronui Ranch”. See our commentary for the relevant months for further details.
· Ralf-Roger Weiss of Germany has approval to acquire 32 hectares at Parkhill and Clifton Roads, Te Awanga, Hawkes Bay for $3,037,500 from GM Beacham of Aotearoa. Weiss “proposes to acquire the subject property to develop a vineyard and winery with a particular emphasis on incorporating the unit into his existing infrastructure in Germany to market and sell the wine produced. The property will be planted in 2003 and the Applicant’s consultant advises it will be planted in eight hectares of Chardonnay, seven hectares of Merlot, and ten hectares in the varieties Cabernet franc, Malbec, Sauvignon blanc and Riesling. It is expected the first wines will be produced for export in 2008. The Applicant also intends to establish a restaurant on the property.”
· Cloudy Bay Vineyards Limited, owned by Veuve Clicquot Ponsardin of France, has approval to acquire 56 hectares at Barracks Road, Omaka Valley, Marlborough for $2,407,500 from PB and DA Goulter of Aotearoa. Cloudy Bay, “who is one of New Zealand’s foremost wine producers proposes to acquire the subject property currently being run as part of a sheep and cattle unit and convert it into a vineyard. The vineyard will be planted predominantly in Sauvignon Blanc. The property will be developed in conjunction with the Applicant’s existing Marlborough vineyard properties. The Applicant has identified a demand for wine styles that are currently beyond its production capacity. The proposed acquisition will assist the Applicant to meet that demand.”
· Tutira Forest LLC, owned 25% each by Carey Doust Cimino, Liam Charles Doust, Dr Matthew Webb Doust, and Richard Webb Doust and Joan Stewart Doust as Trustees of the Doust Living Trust, all of the U.S.A., has approval to acquire 25 hectares at Fearon Street and State Highway 1, Seddon, Marlborough for $1,026,675 from GF Smith of Aotearoa. “The proposal is a joint venture between the Applicant and Koura Bay Wines Limited (the vendor) whereby the Applicant provides the capital and Koura provides the expertise and management to develop a vineyard on the subject property. The Applicant is to enter into a vineyard management agreement for Koura Bay Wines Limited to develop and manage the vineyard and a long-term grape supply agreement to supply grapes from the property to the winery operated by Koura Bay Wines Limited. The proposal allows the vendor to secure a future supply of grapes for processing at its Blenheim winery which is currently operating at below capacity without the need for significant capital investment to develop the vineyard. The property contains 17.3 plantable hectares and will be planted mainly in Pinot Noir with some Sauvignon Blanc and Chardonnay varietals.”
Waihi Gold Company Nominees Ltd, owned 96.4228% by the Newmont Mining Corporation of the U.S.A., and 1.7886% each by minority shareholders in Australia and Aotearoa, has approval to acquire 1.0 hectares at Boyd Street, Waihi, Coromandel for $787,500 from H and J Dillon of Aotearoa.
The land is a “lifestyle property” adjoining a dairy farm whose purchase was approved by the OIC in May 2002 (see our commentary for that month for further details). Both are being bought to pursue the Favona Underground Project, a new extension to the Martha gold mine in Waihi.
The property will be utilised as a buffer area around the mine operations. The dwelling on the property being acquired will possibly be used as accommodation for employees at the mine.
The Applicant’s current open cast mine operation, the Martha Mine, is expected to close in approximately 2007. The Applicant proposes to acquire the subject property in connection with the Favona Underground Project for which they have completed a feasibility study. The project involves a significant new investment for the purposes of an underground gold mining operation. There will likely be few surface effects apart from the air vent shaft, the access portal and the infrastructure required to service the underground workings and transport the ore to the existing processing plants.
The project requires a mining permit under the Crown Minerals Act 1991, resource consents under the Resource Management Act 1991 and a variation to the existing mining licence under the Mining Act 1971. The Applicant has advised that if the necessary consents are not forthcoming then they will sell the property.
Last month, the company bought 13 properties because of subsidences due to old mine shafts in Waihi (see our commentary for June 2002).
· DP and SR Agassis of Switzerland have approval to acquire 1.2 hectares at Dolphin Place, Tutukaka, Northland for $1,400,000 from IE Moratti of Aotearoa. The Agassis “are applying for New Zealand permanent residency under the investor category and propose to acquire a lifestyle property situated at Tutukaka. The Applicants intend to construct a dwelling and reside on the property. The property is part of a subdivision of a larger block of bush/scrub covered land that has not been recently used for any economic purpose. The Applicants have an existing house in Tutukaka at which they currently live in for part of the year. The acquisition of this property did not require consent under the Overseas Investment Regulations 1995.”
· Wen Zhu of China has approval to acquire 6.8 hectares at 150 Whangarata Road, Tuakau, South Auckland for $639,500 from GH and D Ballantyne of Aotearoa. Wen Zhu “is currently living in New Zealand and has applied for New Zealand permanent residency under the business investor category. The Applicant proposes to acquire a lifestyle property situated at Tuakau which has a dwelling and reside on the property.”
· M Crivelli of Japan has approval to acquire Bayview Developments Limited, which owns 22 hectares at Ross Road, Awakaponga, Whakatane, Bay of Plenty, for $0. Crivelli, “who held a 24% shareholding in Bayview Developments Limited entered into an agreement with the other shareholders to acquire their shares in 1994” so this is a retrospective approval. The Whakatane property “had approximately three hectares planted in kiwifruit with the remainder a deer breeding operation and smaller interests such as pine tress and nut trees. No consideration was paid for the shareholding and consent was not sought at the time as it was thought not necessary. This transaction followed the disastrous kiwifruit season in 1993/94 when revenues from the crop were insufficient to provide for the ongoing maintenance of the property. The Applicant was the only shareholder prepared to contribute further capital for ongoing maintenance and future development of the property.” In June 2002, Bayview Developments – by then 100% owned by Crivelli – received approval to acquire 7.5 hectares at 191 Gow Road, Whakatane, Bay of Plenty for $880,000. The new property currently had approximately 3.6 hectares planted in kiwifruit which was to be extended. See our commentary for that month for further details.
· Valor Ideal Limited, owned 50% each by Frederico Chamyan and Jose Richard Chamyan, both of Uruguay, has approval to acquire 7.5 hectares at Railway Road, Palmerston North, Manawatu for $500,625 from Estate ES Jefferies of Aotearoa. The property adjoins properties the Chamyans already own, which are used as a golf course and for farming cattle. They propose to use this property “to expand their intensive beef fattening and calf rearing operation, and to provide additional land for the proposed expansion of the golf course and other facilities including an indoor recreation facility. The property is currently utilised by the vendors as a residence and as a hobby farm carrying only a few head of cattle”. The OIC has approved the sale to them of three other blocks of land: in December 2001, 9.9 hectares at 246 Richardsons Line, Palmerston North, Manawatu for $450,000; which was adjacent to a 30 hectare property at Richardson Line and Settlers Line, Palmerston North whose acquisition was approved in June 2001; in October 2001, the company also gained approval to acquire a 33 hectare golf course at Setters Line and Railway Road, Palmerston North, Manawatu for $4,030,425. For further details, see our commentary on those months.
· An investor whose name and ownership (including country of ownership) were initially suppressed but released on appeal in November 2002 as HB Land Ltd owned by ZRH Nominees (0010) Ltd of the U.K. has approval to acquire 443 hectares at 740 Hickory Bay Road, Hickory Bay, Banks Peninsula, Canterbury for a suppressed amount from CE Grigg Partnership of Aotearoa. The information supplied by OIC as “rationale” for its decision suggests that the investor is a trust with operations in the U.K.: “The beneficiary of the Applicant owns and operates a polo pony stud in England, which currently runs approximately 60 horses most of which have been exported from New Zealand for sale or breeding purposes. Approximately 120 hectares of the subject property is viewed as a New Zealand base to breed and train horses to supply the United Kingdom operation and to establish stronger links with New Zealand horse breeders. In addition to the breeding operation the buying of ponies and the training of them for export will continue. The remainder of the property will continue to be farmed with sheep and cattle. The Applicant has advised that he has longer term plans to develop smaller areas of the property to produce high quality products within the discipline of organic practices, such as a boutique vineyard, and the cropping of herbs. The vendors have had 4.9 hectares of the property near the foreshore covenanted as an Open Space Covenant under the Queen Elizabeth II Trust. In this regard, there is public access to the beach and the Applicant will allow this to continue.”
· DB Parker of Canada has approval to acquire 5.3 hectares at 664A Glenorchy-Queenstown Road, Queenstown, Otago for $370,000 from RB Weenink of Aotearoa. Parker “is currently living in New Zealand, is applying for New Zealand permanent residency under the Investor category” and “intends to reside on the property which has a dwelling on it”.