Crafar buyer yet to relodge OIO application

The Crafar family farm. Photo / Christine Cornege

The Chinese-backed firm fronting a bid to purchase New Zealand's biggest private dairy operation has yet to relodge its application for Overseas Investment Office approval, less than a week before tenders close.

The OIO told Natural Dairy in April it needed more information about its proposed New Zealand acquisitions before it could being processing the application.

It has yet to see the re-submitted application.

Receivers for the farms announced last month they had signed a conditional sale agreement with May Wang's UBNZ - which is 80 per cent owned by New Zealand-based UBNZ Trustee Ltd and 20 per cent by Natural Dairy (NZ) Holdings Ltd, to purchase the farms.

The sale is subject to OIO approval and the absence of a better offer.

However the office cannot begin processing that application until it has received all of the information required, together with the $22,000 application fee.

Wang's PR representative Bill Ralston told nzherald.co.nz UBNZ would not be resubmitting its application to the office until tenders close next Wednesday.

Why this was, was not clear, he said.

Robert Parker of law firm Chapman Tripp said it was hard to say why the company might have stalled on their application, although the cost of filing it might provide some indication, he said.

"It's not only the $22,000, the application itself is a very long-winded document and quite expensive to put together."

It was possible the company could be waiting to see what other offers were tabled.

The OIO works within a 50 working day timeframe to process applications and UBNZ's failure to resubmit its application in a timely way would slow down their proposed deal to purchase the farms, the office said.

A separate investigation into the purchase of four other farms by the Chinese-backed group, which the OIO says it never gave consent for, may also slow down consideration of the deal, the office said.

The Crafar portfolio incorporates 13 dairy farms and three drystock grazing properties, across nearly 8000 hectares in the central and western North Island.

There has been interest in the farms from as far away as Asia, Switzerland and Britain.

State-owned farming company Landcorp has previously said it is considering whether it might bid for the farms, but denied suggestions its interest was a Government directed move to derail the Chinese bid.

Parker said the receivers may prefer to sell the farms to a New Zealand bidder for a lesser amount.

"Commercially the question of whether they get OIO consent is up in the air. It's certainly not a fait accompli. I would've thought if you can sell it to a Kiwi for less, you would look at that seriously."

Receivers for the farms KordaMentha, said the issue as to whether a delay in submitting an application might affect a possible sale if a lower, cash offer came in, was not up for debate.

"We have a better offer clause and we will just see where we end up at the end of the process," spokesperson Brendon Gibson said.

KordaMentha said they never expected approval to be granted by the close of the tender process.