Kidmans slate sale block
The Kidman family is digging in for a fight with Treasurer Scott Morrison over his suggestion they break up their cattle empire built up over 120 years and sell it off in pieces.
Two Chinese companies represented by Dakang Australia last week withdrew a $371 million bid for Kidman and Co after moves by Mr Morrison to veto the deal on the grounds it was not in the national interest.
Kidman managing director Greg Campbell said the family shareholders did not want to see the business, which includes 150,000 cattle and covers more than 10 million hectares, split up because it would diminish in value.
“Kidman is typical of many large agricultural pastoral holdings in that the value of the business comes from the strategic advantage in having a geographically spread portfolio of properties,” he said.
“A break-up of the business to sell properties separately would result in significant reduction in Kidman’s value, reduced production of up to 3000 tonnes of beef per annum, the loss of 50 jobs from the present structure and lower tax revenue for the country.
“This also means that consortium’s proposed $46 million in new capital investment to support growing the herd to 220,000, and the additional of up to 50 jobs in northern Australia, would not go ahead.”
Mr Morrison said last Friday that putting Kidman on the market as a whole had made made it difficult for Australian entities to bid. He gave Dakang just 96 hours to respond to his concerns about its bid, which had been accepted by the Kidman board.
Mr Campbell said more than 130 Australian parties had been approached as part of a sale process launched in April last year.
“It is important to note that no final bids were received from Australian parties at any time during the extensive and lengthy sale process,” he said.
In a pointed reference to the Federal Government’s position on Chinese investment, Mr Campbell said: “We also welcome interest from anywhere around the world, including the US, Chile and New Zealand. Investment by non-government entities at this scale from these countries requires no approval from the Foreign Investment Review Board or the Treasurer.”
Shanghai Pengxin and Shanghai CRED, the two Chinese companies behind the Dakang bid, remained tight-lipped.
In deals separate to the Kidman sale, Shanghai CRED is making big investments in the WA cattle industry. The deals will see it control pastoral leases covering about 1.5 million hectares in the Kimberley and Goldfields.
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