Maori question Crafar farms sale

ANDREA FOX
Last updated 05:00 04/09/2012

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Maori trusts are expected to this week challenge a Court of Appeal decision clearing the way for the sale of the Crafar farms to Chinese company Shanghai Pengxin.

The court last month dismissed legal challenges from a farmer group led by Sir Michael Fay and the Tiroa E and Te Hape B Trusts to the long-running attempt by Pengxin to buy the 16 North Island Crafar farms, which have been in receivership for nearly three years.

Fay has walked away from the fight, but it is understood the trusts, which want to buy three farms in the central North Island that they claim are ancestral land, will go it alone in challenging the decision in court tomorrow. It is possible the court may not accept the trusts have a case to test.

The trusts represent Tu Wharetoa and Ngai Rereahu.

Pengxin is to contract state-owned farmer Landcorp to manage the farming estate, fulfilling a condition of the Government's consent for the purchase.

Landcorp has been acting as Pengxin's representative for the potential sale of the three farms to the Maori trusts, which claimed Landcorp had offered to sell them for $66.5 million.

The purchase price for the 16 farms has never been revealed by receivers KordaMentha, but is understood to be around $210m. Pengxin had hoped to have taken ownership of the farming estate by spring.

Landcorp chief executive Chris Kelly yesterday said providing there was no appeal to the Appeal Court ruling this week, Pengxin would go unconditional.

Pengxin would pay over the purchase money 30 working days after declaring the deal unconditional, unless it settled earlier, Kelly said.

Between unconditional and settlement dates, Landcorp would do due diligence, he said. This would involve counting dairy cows on the farms – thought to be around 13,000 – their condition, and feed reserves. It was most unlikely the process would turn up a dealbreaker for Landcorp, Kelly said.

As 50:50 sharemilker on the farms, Landcorp has to buy the livestock.

Because of the lateness in the new season of taking over management, Landcorp would be paid a management fee until June next year, after which the 50:50 arrangement would kick in.

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- BusinessDay.co.nz

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