Crafar farms disposed of but bills still rolling in

Last updated 14:59 05/12/2012

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Crafar farms receivers have now billed around $7.7 million in fees and legal costs are heading for $6 million with two months of fees still to come.

The tortuous three-year disposal of the North Island 16-farm estate ground to an end on November 30, when Chinese company Shanghai Pengxin - the receivers' preferred bidder - was finally able to settle the purchase after a string of court challenges. 

KordaMentha's latest reports to the Companies Office for the receivership show they claimed $744,850 in fees between April 5 and October 4.

This brings KordaMentha's bills to their Crafar banker and financier clients to around $7.74 million.

Legal costs for the same period this year were $914,138, taking the total legal bill to date to around $5.6m.

The central and southern North Island Crafar farms, at the time the biggest family owned dairy operation in the country, were put into receivership in October 2009 owing $200m to financial backers. Lead bank is Westpac.

KordaMentha's latest report says that on a group basis, total bank debt owing as at October was around $294m.

The final price Pengxin paid for the farms is unknown, but an unsuccessful counter bid for $171.5m by a group of farmers and iwi led by businessman Sir Michael Fay was rejected as too cheap.

There were four companies involved in the Crafar group receivership - Plateau Farms, Hillside Ltd, Ferry View Farms and Taharua Ltd.

The Crafar farms total nearly 8000 hectares. State farmer Landcorp is managing the farms for Pengxin as a condition of government consent for the Chinese to buy the farms. 

Insolvency specialists have said the Crafar receivership is uncommon, so its costs are difficult to compare to other big receiverships.

The latest report shows net cashflow for Plateau Farms in the reporting period to October 4 was $2.1m; for Taharua negative $3307; for Ferry View $172,343; and Hillside $7.6m. 

Plateau Farms is the largest company in the former family business with nine central North Island farms.

Ferry View Farms operates a dairy farm at Scotts Ferry, Manawatu, and Hillside has five dairy farms through the central North Island.

Taharua operates a large-scale dairy farm at Taupo.

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- Waikato Times

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