Probe launched into Chinese Crafar farm buy

The sale of four dairy farms formerly owned by Allan Crafar (pictured) to a Chinese company is being investigated by the Overseas Investment Office. Photo / Herald on Sunday.

The woman behind a $1.5 billion dairy farm bid to buy the Crafar farms has struck out at the media, who she says are undermining the credibility of Natural Dairy and its plans for investment in New Zealand.

The Overseas Investment Office is investigating the purchase of four Crafar farms by a Hong Kong investment group, which it says it never gave consent for.

But May Wang, said she was confident the investigation would prove there was no breach, because the purchase fell within the bounds of the Overseas Investment Act.

Wang said the investigation was inevitable given the "hysterical, overblown and often incorrect coverage given by some media to the UBNZ/Natural Dairy deal.

"Some media have made much of my previous business difficulties, which I am working hard to remedy, and are using that as a means of undermining the credibility of Natural Dairy and its plans."

UBNZ was 80 per cent owned by the New Zealand based UBNZ Trustee Limited and 20 per cent by the Hong Kong based Natural Dairy (NZ) Holdings Limited.

"As I am a New Zealand citizen and Natural Dairy only has a 20 per cent stake, less than the 25 per cent trigger point for an OIO application, the purchase completely conforms with the Act," she said.

An investigation of the land titles register reveals UBNZ Funds Management Limited purchased two farms on February 11 this year, one near Norsewood, and the other in Waitotara.

Four days later two further farms were purchased in the Manawatu by UBNZ Funds Management Limited before being transferred to UBNZ Assets Holdings Limited.

Part of the investigation would determine whether the company breached the act.

It was an offence for an overseas person or an associate of an overseas person to buy sensitive land without consent, OIO manager Annelies McClure said.

Breaches of the Act can attract a fine or civil penalty of up to $300,000.

The OIO said it expects the investigation to take several months.

Wang said the investigation risked slowing down the rest of the deal to buy up the remainder of the Crafar farms, which was subject to OIO approval.

The purchase of the four farms and the remaining Crafar farms represented a mere 25,000 cows out of five million in New Zealand, which hardly constituted a serious threat to the country's dairy industry, she said.

The dairy industry would benefit enormously through increased employment and training opportunities, added value export products and considerable tax revenues.

"The plain fact is if New Zealand does not welcome the investment it is inevitable the company will take its $1.5 billion to another dairying nation that does want it," she said.