Resources

Key facts
Key facts on foreign control in Aotearoa/New Zealand
Foreign investment in New Zealand
CAFCA's monthly analyses of the decisions of the Overseas Investment Office and predecessor, the Overseas Investment Commission.
Views, analyses, research
Press statements, Submissions by CAFCA, The Roger Award and other miscellany
Aotearoa Independence Movement
Resources relating to CAFCA's campaign
Links
Useful links to groups with related interests.
Search
Search the CAFCA and Foreign Control Watchdog websites.

Foreign investment in Aotearoa/New Zealand

Overseas Investment Office - July 2014 Decisions

French Buy Infant Milk Formula Plant

Danone Asia Pacific Holdings Pte. Ltd Danone SA, France (100%), received approval for the acquisition of property in New Zealand used in carrying on business in New Zealand for consideration exceeding $100m, that property being:

The acquisition of up to 100% of the securities in Sutton Group Limited, K&B Limited and Nutritional Can Manufacturers Limited; and
The assets and business of Gardians Limited.

The vendor was Sutton Group Holdings Limited, Gardians Limited, Sutton Properties Limited and The Kensington Trust and Broadwood Trust Partnership, New Zealand (100%); consideration was withheld. The OIO states: "The Applicant seeks to acquire the business and assets from the vendor and undertake the business of processing raw milk into paediatric formula and the packing of the formula into individual cans for sales across the Asia-Pacific region".

Danone is a huge French transnational - dominant in yoghurt, packaged water, cereal biscuits and snacks. See our August 2002 commentary for details of its purchase of Frucor Beverages including Fresh Up, Just Juice, McCoy, NZ Natural, Citrus Tree, and V brands. More recently, Danone alleges to have suffered large losses as a consequence of the Fonterra milk powder scare in late 2013. Christopher Adams in the New Zealand Herald reported briefly on the deal (30/3/14).

"French food giant Danone has entered an agreement to buy New Zealand dairy processing firms Sutton Group and Gardians. News of the deal comes as this country's dairy industry negotiates a raft of new Chinese infant formula regulations, which come into force tomorrow. Auckland's Sutton Group is best known for infant formula contract manufacturing, while Gardians - a joint venture with Sutton - operates a milk powder spray drying plant in Balclutha, Otago. Danone's purchase price has not been disclosed.

"The French firm is the parent company of infant formula maker Nutricia, which operates a factory in Auckland's Mt Wellington. 'Last year we undertook a process to find new capital to grow the business and take it to the next level when we were approached by Danone', said Sutton co-founder Brent Sutton. 'It is our belief that these family-orientated businesses are a great fit and we are excited at the prospects that Danone can provide for the future of Sutton Group and Gardians in New Zealand'. The deal is subject to regulatory approval. Danone is suing New Zealand dairy cooperative Fonterra over lost sales and other costs it claims resulted from last year's botulism scare".

Inghams Sells And Leases Back Poultry Farms

Inghams Enterprises (NZ) Pty Limited, United States Public (28%), various overseas persons (25%), Canada Public (17%), Singapore Public (14%), Dutch Public (10%) and United Kingdom Public (6%), received approval for acquisition of a leasehold interest in approximately 174ha of land located at Matamata, Putaruru and Waitoa; and an overseas investment in significant business assets, being the Applicant's acquisition of property in New Zealand used in carrying on business in New Zealand for consideration possibly exceeding $100m (as the rent payable over the terms of the leases (including renewal terms) might exceed $100m).

The vendor was Inghams Enterprises (NZ) Pty Limited/Unknown Purchaser(s); asset value stated at $100,000,000+. The OIO states: "The Applicant is selling its current freehold interest in the relevant sensitive land and replacing it with a leasehold interest in the same land for commercial reasons. The Applicant will continue its current poultry business on the land". See our June 2013 commentary for recent changes in Inghams' shareholding.

Metroglass Prepares For IPO

Metro Performance Glass Limited, various overseas persons (81.8%), Australian Public (5.8%), United States of America (8.7%), Germany (2.3%), New Zealand (1%) and United Kingdom (0.4%), received approval for n overseas investment in significant business assets, being the Applicant's acquisition of rights or interests in up to 100% of the securities of Metroglass Holdings Limited, the value of the New Zealand assets of Metroglass Holdings Limited and its 25% or more subsidiaries being greater than $100m.

The vendors were existing shareholders of Metroglass Holdings Limited, various overseas persons (9.1%), Australian Public (28.8%), United States of America (43.5%), Germany (11.3%), New Zealand (5.2%) and United Kingdom (2%); consideration was $307,500,000. The OIO states: "Metroglass Holdings Limited (MHL) is a leading value-added processor of glass in New Zealand and sells a full range of glass products. MHL seeks to launch an initial public offering (IPO). The Applicant intends to acquire 100% of MHL and then undertake an initial public offering of MHL shares. The existing shareholders of MHL will retain a shareholding of approximately 20% in the Applicant once the initial public offering has been completed, with various New Zealand and overseas persons making up the balance of the Applicant's shareholding".

This IPO comes as no surprise, the existing shareholders being former creditors of Metroglass, and converting their debt to equity in January 2012 to keep the business sustainable. According to the IPO media release, Metroglass processes more than two million square metres of glass products per year and is the largest value-added glass processor in New Zealand. It produces a range of customised glass products that are predominantly used in residential and non-residential construction applications. It has national coverage through 17 decentralised sites, including five major processing sites, a fleet of over 260 service vehicles and more than 700 employees across New Zealand.

Germans Buy Mount Marsh Forest

Mount Marsh LP, Germany (100%), received approval for the acquisition of a freehold interest in approximately 239.5 hectares of land known as Mount Marsh Forest and situated at Castle Hill Road, Alfredton. The vendor was Roger Dickie Developments Limited New Zealand (100%). Consideration was "withheld under section 9(2)(b)(ii) of the Official Information Act". The OIO states: "The majority limited partner of the Applicant is one of the largest private forest owners in Germany, having a woodland estate of 7,700 hectares. The acquisition of Mount Marsh Forest will enable diversification of those forestry interests to other geographic locations". See our September 2012 commentary for details of other sales by Roger Dickie to Austrian and Canadian investors and our February 2013 commentary for details of another sale to Italian interests.

Craigmore Buys 2,721 Hectare Taieri Lake Station

Craigmore Farming NZ LP, United Kingdom Public (36%), Hong Kong Public (17%), German Public (10%), New Zealand Public (10%), Irish Public (6%) and various overseas persons (21%), received approval for the acquisition of a freehold interest in approximately 2,721 hectares of land located at 7797 Hyde-Middlemarch Rd, Otago (Taieri Lake Station). The vendor was Raymond & Ellen Catherwood New Zealand (100%); consideration was again "withheld under section 9(2)(b)(ii) of the Official Information Act".

The OIO states: "The Applicant intends to use the property for grazing young dairy stock, whilst maintaining a cross-bred ewe flock to run on the hill country. The property is situated within reasonable proximity to other North Otago dairy properties owned by the Applicant which is likely to lead to operational and cost efficiencies". By our records this is Craigmore's largest purchase by land area to date. See our previous commentaries in June 2012, February 2013, March 2013, November 2013, March 2014, April 2014, May 2014 and June 2014 for background on Craigmore Farming and its other land purchases here.

Chinese Buy Stratford Abattoir

Gold International Holdings Limited, Guoqiang Zhang, China, People's Republic of (100%), received approval for the acquisition of a freehold interest in approximately 12.9 hectares of land at 3396 Mountain Road, Stratford. The vendor was Taranaki Abattoir Company (1992) Limited, New Zealand (100%); consideration was $2,000,000. The OIO states: "The Applicant seeks to acquire the land and the abattoir business located on the land. The Applicant has already provided capital investment which will likely ensure the on-going viability of the abattoir business".

However, as Matt Rilkoff at NZfarmer.co.nz reports 3/10/14), smaller farmers in the area are facing higher costs as a consequence of the sale. "A Chinese government-owned company has been cleared to buy Taranaki's only abattoir processing local meat for the local market. Gold International Holding Ltd, a company owned 100% by the People's Republic of China, received Overseas Investment Office approval in July to buy Stratford's Taranaki Abattoir for $2 million.

"One year ago the company invested $1m upgrading the plant so it could export meat to China. It is understood the sale of the factory will go through once it gets official Ministry of Agriculture and Forestry certification to start shipping meat there. Current owner Terry Lester confirmed the Chinese company had taken over the running of the abattoir floor in June. He said he had been contracted to continue in an advisory role for a number of years. Lester said the abattoir was hoping to be listed as an approved exporter to China on October 14.

"He said the Chinese owners had stopped accepting small local jobs of three or four animals until this listing was achieved. 'But no-one has said this is a permanent thing and that we are not going to process meat for the domestic market ever again', Lester said. Once the abattoir had a listing to export to China the abattoir's future would be more secure and the number of employees would double to around 40, he said. However, in the meantime, local meat sellers have lost the only facility killing and processing small numbers of animals for resale in Taranaki. This means they must now be shipped to Whanganui's Land Meats for processing and there are fears Taranaki's only processing plant will never move back to supplying the domestic market. Home kill operators cannot fill the gap as they can kill meat only for the owner of the animal and their family, not for resale.

"Stephen Morrison of New Plymouth's Kiwi Butcher said they got no warning they would not be able to have local meat processed at the abattoir. 'They just said, "okay, you can't get anything killed here any more'' he said. Inglewood pig farmer Helen Foreman said she and her husband had seen the 'writing on the wall' some months ago and arranged to have their animals slaughtered and processed in Whanganui. Foreman said it actually worked out $10 cheaper per animal and it was even cheaper to have them processed in Auckland. 'It wouldn't have been if they hadn't put their prices up but they were pricing themselves out of the market', Foreman said. Small suppliers like Stratford's John Earney, of Avonstour heritage organic farm, has been one seller caught short by the change. On Sunday he had no meat to sell at New Plymouth's Farmer's Market".

Chinese Also Buy Okoroire Hot Springs Hotel

Kingstown Volcano Springs Limited, People's Republic of China (100%), received approval for the acquisition of a freehold interest in approximately 27 hectares of land located at 18 Somerville Road, Okoroire. The vendor was Okoroire Hot Springs Hotel Limited, New Zealand (100%); consideration was $3,300,000. The OIO states: "The Applicant intends to develop the existing hotel and related facilities (including new accommodation and hot pools) in order to provide a new tourism experience for visitors".

Americans Buy Hurunui Dairy Farm

GMO Farm Land Optimization Fund LP, United States Public (66%), Swiss Public (13%), United Kingdom Public (12%) and various overseas persons (9%), received approval for the acquisition of a freehold interest in approximately 396 hectares of land located at 865 Balmoral Station Road, Culverden, Hurunui, Canterbury. The vendor was Triangle Pastoral Limited, New Zealand (100%); consideration was withheld. The OIO states: "The Applicant intends to generate attractive investment returns by carrying out improvements to the dairy farm operation carried out on the land and, in particular, by increasing the amount of effective dairy pasture and the size and quality of the dairy herd, under the management of a New Zealand agricultural consultant." I pray in this instance, GMO is not an acronym for Genetically Modified Organism?

While Europeans Expand Their Taupo Dairying Interests

Southern Pastures Limited Partnership, Swedish Public (58.2%), Luxembourg Public (23.5%), German Public (15.7%) and New Zealand Public (2.6%), received approval for the acquisition of a freehold interest in approximately 455.8 hectares of land at Tirohanga Road, Taupo. The vendor was Te Waihou Plantations Limited, United States Public (34.8%), Saudi Arabian Public (22.1%), Danish Public (12.4%), Liechtenstein Public (12.4%), German Public (5.7%), Swedish Public (5.3%), New Zealand Public (4.4%), Canadian Public (2.6%), Australian Public (0.2%) and Singapore Public (0.1%); consideration was $2,000,000. The OIO states: "The Applicant intends to convert the land which is currently afforested to dairy land to support the Applicant's existing dairy farms in the area". The existing farms in the area total over 3,200 hectares and were acquired from Graeme Hart's Carter Holt Harvey in December 2012, at around half the going rate for dairy farms in the area.

Other July Decisions

Stephen and Karen Coles, Karen Sadie Coles, United Kingdom (50%) and Stephen Boyd Coles, United Kingdom (50%), received approval for the acquisition of a freehold interest in approximately 79.7 hectares of land at 96 Newport Road, Tapawera, Tasman District. The vendor was N&J Brake Limited, Jennine Faye Brake, New Zealand (50%) and Noel Gordon Brake, New Zealand (50%); consideration was $1,000,000. The OIO states: "Mr and Mrs Coles intend to move to and reside indefinitely in New Zealand. They will use the residence on the farm as their family home and lease out the land".

Bardfield Farms Limited, Mark Purcell Tapper, New Zealand (25%), Garth Walton & Jan-Maree Smith and Nicholas Johannes Hoogeveen, New Zealand (25%), Doug Hall Poultry Pty Limited, Australia (16.7%), Alpair Pty Limited, Australia (16.7%) and Campastco Pty Limited, Australia (16.6%), received approval for the acquisition of a freehold interest in 142.9 hectares of land at 561 Monument Rd, Maramarua, North Waikato. The vendor was Monument Road Limited, Mark Purcell Tapper, New Zealand (50%) and Garth Walton & Jan-Maree Smith and Nicholas Johannes Hoogeveen, New Zealand (50%); consideration was $2,250,000. The OIO states: "The proposal involves the Applicant's acquisition of land currently leased from two of its shareholders, in order to realise operational and growth advantages from security of tenure". Barfield is a pig farmer. See our October 2009 and November 2011 commentaries for details of the original purchase of the pig farms.

Campaign Against Foreign Control of Aotearoa,
P.O. Box 2258
Christchurch.

CAFCA

Campaign Against Foreign Control of Aotearoa (CAFCA)