A ministerial decision on the sale of 16 farms to China’s Shanghai Pengxin is due late tonight or tomorrow, the High Court in Wellington heard today.
Yesterday cabinet briefly discussed the Overseas Investment Office’s recommendation on whether Pengxin should be cleared to buy the Crafar family farms. Land Information Minister Maurice Williamson and Associate Finance Jonathan Coleman have the final say on whether to approve the deal.
A rival consortium led by controversial Kiwi businessman Michael Fay was in court today seeking directions on a case opposing the sale but no orders were given as the two sides had reached agreement on three issues.
Belly Gully lawyer David Cooper, representing the Fay consortium, said the application for approval had been provided to his client and the OIO’s recommendation made to the ministers would be made available when the decision was made.
It had been agreed with Milk New Zealand Holdings that they would not take steps to settle the transaction prior to 5pm on Friday, Feb. 3.
The Fay consortium still intends to seek a judicial review if the Chinese consortium gets approval.
Peter McCarthy from Crown Law said a decision is due late tonight or tomorrow.
The parties are to hold a telephone conference at noon on Monday.
The sale involves 8,000 hectares of North Island farmland. Its sale to a foreigner has been controversial.
The Fay-led consortium, including Tiroa E and Te Hape B Trusts, Tauhara Hapu Trusts, Aitchison Farms, WD Holmes 2000 Trust, Donovan Group and Brent Cook launched a rival $171.5 million offer in September, believed to be some $30 million below Pengxin’s bid.
The Fay group had its bid for the farms declined by receiver KordaMentha, who called the price “unacceptable”.
Prime Minister John Key said yesterday that he hasn’t seen anything to make him question the OIO’s processes.
Key has talked down the extent of foreign ownership of local farmland, saying he understood it to be less than 1 percent.
“The wholesale sale of land in New Zealand is not in New Zealand’s best interests, and that was why we sought to toughen up the overseas investment act,” he said. “At around about 1 percent, I don’t think we have a substantial issue.”
The Crafar farms were tipped into receivership - with KordaMentha appointed receiver - by lenders Westpac, Rabobank and PGG Wrightson in October 2009 who were then owed about NZ$216 million.
23 Comments
I hope this landmark case isn't influenced by peoples attitude towards Fay or his threat of legal action if he loses. I suspect the desire to give it to him could tip the balance and set a dangerous president of giving up our key national assets to foreign investors.
People get so politically correct and self righteous about these decisions if anyone even suggests we should stop the Chinese buying our farmland. Why are we so eager to look after the interests of foreign investors instead of the interests of future kiwi generations.
The former would not let us buy up significant land in their country, will take profits and opportunities offshore and are using funds obtained with the help of currency manipulation and money printing. The later will pay your pensions and look after you in your old age assuming we haven’t given away all the family assets for a quick buck.
Yes Julz, not to mention saving $30 million for Mr Fay et el......
Smart operator this guy, spend a few thousand to hire a lawyer and throw in a few "indegenious" and splash some colour into the mix plus a bit of Racist Xenophobia and and hey presto....$30 million in the kitty.....
Some Kiwis just can't see past the colour....White is fine but Yellow is not !!
It's cheap and easy to play the politically correct race card isn't it, requires no brain power and shuts most people up with a different view for fear of being called a racist.
Fay is representing a consortium of kiwi investors of all colours, if he was yellow and the foreign investor was white I would make exactly the same points. He also only makes 30mil if he is then allowed to sell to a foreign buyer which of course he couldn't if he gets it since he is making the highest local bid.
Please come up a sensible objection rather than just spouting this politically correct rubbish.
But the point is it's not the market price if we keep it in NZ because Fay is making the highest local bid. A foreign investor has to pay a premium (effectively a bribe) to secure an investment like this, I don't think we should then consider that the market price.
Selling our farms to foreigners has never been an issue unitl now (we have sold more than 600,000 hecters according to John Key lately) when the new buyer happens to be a Chinese company. All the previous buyers has been White !!
Selling farms now and selling farms then, what's changed?? Farms economics? Trade and Current account deficit?? If so than all the more that we HAD to sell our farms to foreigners !!
Local Kiwis make better Dairy Farmers ?? Why did Alan Crafar failed as a Dairy Farmer then ??
This is not political correct BS like some racist want to put it to deflect their own racism...
This is by far the biggest foreign purchase of farmland which is why it is on the radar, not because it is Chinese. If it had been a smaller size like all the others you are referring to we would not be having this discussion.
China is getting a lot of negative attention for other reasons of course like their currency manipulation, their disregard for patent law, their own protectionism towards foreign investors etc.
Bottom line is we should be able to have sensible debates on all these topics without being accused of being racist every time.
The real issue all along has been the fact it's the Chinese government hiding behind the doggyist person their could possibly find (1.3billion ppl and they pick May Wang FFS) if it had been a Chinese farming family wishing to live here and farm the land we'd probably bake a sponge, go around when they arrive give them a hug and say welcome home!....but its not, its the Chinese government... and no one trusts them!
Ah So NeilD..the real issue has always been the banks wanting back the loan money in full that some dumbo lent out on the crap farms. It is the banks that John Key has spoken to today...asking them how much they will sell for. "Not a penny less than the total credit we dreamed up... John"
If that were the case then there wouldn't be an issue...the public out cry, ('the issue'), and therefore the media circus IS about the character of the preferred bidder!
And the farms on the whole ain't crap, just run bare so to speak, and as i have stated before Rabo don't do deals without being well and truely covered...theres quite a gain in this for the receivers clients...
If you recall the Crafer farm bankruptcy was also in the news long before any buyers emerged so any bidder coming to the rescue was going to get publicity.
Don't be so quick to think the worst of Kiwi's and make accusations of racism. The objection was to the current politically correct environment that prevents us even having sensible discussions on foreign ownership, which you then went on to demonstrate so clearly.
I have heard reports of other farms in the area of the Crafar farms coming on to the market in the expectation that the OIO will approve this sale and hope the buyers will then buy the other farms on the market.
Bernard, can you find out what percentage of dairy land is currently owned by foreigners?
So its just the same old incompetent leadership, making same stupid mistakes while they bask in the glory that leadership gives to those who rule over the unwashed.
I too had heard that they were storing again. I also heard that landcorp had been hiring staff to run Crafars about 2 months ago.
Its all about the banks and the top %1 getting the cream by milking all the rest.
Aj old boy, settle down, i think you're looking for reasons to move offshore, its not that bad...nothing wrong in the slightest with our leaders, business or political, travelling seeking to do business with the Chinese or anyone else for that matter, thats what we pay them for right?..it worked didn't it...stockpile cleared!!!...Yes i've heard the receivers have laid off seasonal staff then hired contractors to complete their tasks such as harvesting...but its all very much 'he said she said' stuff...don't quote me eh!
Does anyone see the irony and paradox in the fact there is basically a massive trade imbalance between China and the West, yet when China try to do anything with their accumulated capital it faces a massive uphill battle with regard to actually making a purchase whether that be Aussie minerals, NZ farmland or US infrastructure investment.
The US infrastructure investment is the one that gets me the most.
If the Chinese invested in US infrastructure, then China would get a return on investment, the US would get modern infrastructure and allow their economy to increase productivity (pay down debt).
Yet we opt to do nothing, as the US is too proud and would rather see its infrastructure deteriorate to 2nd world status than accept Chinese capital.
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