Chinese drop out of negotiations for CHH farms

The Chinese-backed company planning a bold expansion into the dairy industry walked away from a potential farm deal with Carter Holt Harvey, says its lawyer.

Forest products company Carter Holt Harvey has 29 farms for sale near Tokoroa for a combined asking price of $224.5 million.

Hong Kong stock exchange-listed Natural Dairy (NZ) Holdings owns 20 per cent of local firm UBNZ Assets Holdings which has an application with the Overseas Investment Office to buy a group of 23 farms, including properties that once belonged to the Crafar family.

Auckland lawyer Kerry Knight from Knight Coldicutt, representing UBNZ Assets, said there had been an offer on the table.

"In fact, it was quite an involved offer with the price and what they would do and they'd sell us processing plant ...

"A whole lot of stuff like that, so they were happy to sell but in the commercial terms we couldn't reach agreement on," Knight said.

"The Carter Holt people said unless you pay the whole purchase price up front into a solicitor's trust account while you're waiting for [Overseas Investment Office approval] we won't deal with you," Knight said.

"So we said, 'Look we can't do that, thank you very much, goodbye'."

Carter Holt Harvey could not be reached yesterday for comment.