Australia's largest dairy farm to be sold to Chinese investor

Van Diemen's Land Company (VDL), Australia's largest dairy farm, is to be sold to Moon Lake Investments, owned by Chinese investor Lu Xianfeng.
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The dairy, based in northwest Tasmania, is the single largest supplier of milk in Australia. For the 12 months ended 31 May 2015, the farm milked over 17,800 cows to produce approximately 7.66m kg of milk solids – an increase of 14% on 2014.
It owns and operates 25 dairy farms, a dairy support unit and a standalone heifer-rearing operation. Based on the average size of a holding in Ireland, approximately 215 Irish farms could fit into VDL’s 17,450 acres.
This week, Australia’s treasurer Scott Morrison announced the government’s approval of the sale of VDL to Moon Lake Investments, a private Australian company owned by a Chinese investor, Lu Xianfeng, subject to certain tax conditions that aim to protect Australia’s tax revenue.

Protecting Australia’s national interest
The decision to approve the sale was based on a recommendation from Australia’s Foreign Investment Review Board (FIRB), which assesses potential threats of foreign investment to the country’s national interest.
The sale is also subject to other conditions designed to protect Australia’s national interest, including national security and the impact on competition.
For example, Moon Lake Investment said it intends to continue to supply the milk produced at VDL under the same contractual terms as are currently in place. This provides assurance that there will not be an impact on the supply of milk and milk products in Australia.
Moon Lake has also committed to honour the terms of all environmental and cultural agreements entered into by VDL, including with the Indigenous Australian community. This includes the in-principle approval for construction of a “Devil Proof Fence” at its Woolnorth property to help reduce the spread of Devil Facial Tumour Disease among the Tasmanian Devil population.
Commenting on the approval, Morrison said: «In forming my view I have carefully considered the national interest test and how it applies to this case, including the likely impact on local jobs and increased investment to support economic growth.»
VDL was formerly to be sold to credit card company OnCard International Ltd (now called TasFoods Ltd) but in late November 2015 the dairy pulled out of the conditional €250m agreement and instead sold the property to Moon Lake Investments, subject to government approval.
Australia blocks sale
Although the FIRB approved the sale of VDL to a foreign investor in this case, it has previously cautioned against foreign investors buying Australian farms.
In 2015, the FIRB recommended that Australia’s largest cattle station, S Kidman and Co, should not be sold to Chinese investors, due to the fact that around 50% of one of Kidman’s stations, the Anna Creek, is located in the Woomera Prohibited Area (WPA) weapons-testing range in south Australia.
Commenting at the time, treasurer Scott Morrison said: “It is not unusual for governments to restrict access to sensitive areas on national security grounds. Given the size and significance of the total portfolio of Kidman properties, along with the national security issues around access to the WPA, I have determined, after taking advice from FIRB, that it would be contrary to Australia’s national interest for a foreign person to acquire S Kidman and Co in its current form.”
 Source: FarmersJournal

Mirá También

Así lo expresó Domingo Possetto, secretario de la seccional Rafaela, quien además, afirmó que a los productores «habitualmente los ignoran los gobiernos». Además, reconoció la labor de los empresarios de las firmas locales y aseguró que están «esperanzados» con la negociación entre SanCor y Adecoagro.

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