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MELBOURNE - James Packer, Australia's richest man, may seek partners or private equity funds for his family cattle company Consolidated Pastoral to help fund any expansion as demand for beef grows in countries such as China.
"Now is the time to do it because there is so much interest and there's quite a bit of cash around," Ken Warriner, managing director of Northern Territory-based Consolidated Pastoral, said. Australia is the world's second-largest beef exporter.
Packer has already teamed up with buyout firm CVC Asia-Pacific, selling half of Publishing & Broadcasting's media assets into a joint venture and raising A$4.5 billion ($5.1 billion). Macquarie Bank, Australia's largest securities firm, is setting up a fund to buy sheep and cattle ranches to meet rising meat demand in China and India.
Consolidated Pastoral, Australia's second-largest cattle rancher, was formed in 1983 when Kerry Packer, James' father, bought Newcastle Waters Station in the Northern Territory. The group's 16 properties in four states cover more than 4 million hectares.
The company planned to boost cattle numbers by about 10 per cent to 280,000 in two years, and was looking to split its ranches from its meat-processing and live cattle-exporting businesses, Warriner said.
Consolidated Pastoral holds a 50 per cent stake in Teys Bros, which operates five abattoirs in Australia. It also ships dairy cattle to China through its Austrex operations.
Meanwhile, Macquarie said it might spend as much as A$1 billion for its pastoral fund in anticipation population growth and rising incomes will drive red-meat consumption in countries such as India and China.
"The demand around the world for protein is identified and very compelling," Alan Hayes, managing director of Macquarie Bank's Pastoral Services said last week.
"It's projected that Asia by 2010 will need to import 100 per cent of Australia's total beef production and 90 per cent of our total lamb production," based on current output.
- BLOOMBERG
