Crafars and receivers come to agreement

The former Crafar farm owners hope the Government will reject the latest Chinese bid. Photo / Christine Cornege

The Crafar family have reached a truce with receivers, nearly two years after the collapse of their farming empire.

And they say they remain hopeful the Government will reject the latest Chinese bid for 13 dairy farms and three drystock farms they formerly owned in the central North Island.

Receivers KordaMentha took control of the farms in October 2009 after the Crafar family companies running them accumulated debts of more than $200 million.

KordaMentha receiver Brendon Gibson yesterday confirmed a settlement had been reached.

A spokesman for the Crafar family, former barrister Vinay Deobhakta, said the terms were confidential, but the family were "hugely relieved" the receivers had agreed to drop legal proceedings.

"I can confirm that it has been an incredibly stressful time for them for the past two years. They just want to take a big breather for a while before they start working out what they are going to do from here."

Relations between the Crafars and receivers hit a low in March last year, after the family refused an offer of six months' free rent in Rotorua if they moved out.

KordaMentha began eviction proceedings, and the family hit back with their own legal action, arguing a lifetime lease entitled them to stay.

The family have previously hinted at attempts to buy back their farms, but Mr Deobhakta would only say they had not yet given up hope the farms might remain in New Zealand hands.

"The team's view on that issue is we don't support foreign ownership of this kind of sizeable holding of land. We want to see it go to New Zealand interests, and the family are hopeful the latest Chinese bid won't be approved by the Government," he said.

A bid by Chinese company Natural Dairy to buy the farms was rejected by the Overseas Investment Office (OIO) late last year on the grounds that not all those associated with the company were of "good character".

A new Chinese offer, from private conglomerate Shanghai Pengxin, was filed with the OIO in April and will be considered under tougher rules introduced by the Government in January.

But the Government will still have the final say and there is speculation it is unlikely to consider the offer before this year's election.

OIO manager Annelies McClure said yesterday she was perplexed by the speculation, but could not be specific on when a decision would be made.

Mr Deobhakta said he believed there was still a lot of support for the Crafar family.

"When Allan [Crafar] went to Fieldays last week, there were a lot of people coming up to him and shaking his hand. He's a very popular guy. He got a lot of heart from the way he was treated, and it wasn't just farmers, either."

Last April, KordaMentha receiver Michael Stiassny struck back at claims of rough treatment of the family and poor farm management.

Mr Stiassny said the receivership was one of the most intense he had encountered, and was of a "magnitude unparalleled in the industry".

The resources required were more than anyone could have imagined, he said.