Offer for investors
A $13 million Hinds dairy farm is being resyndicated, with a new offer introduced to allow smaller investors to become part of dairying in Canterbury.
An investor group of 10 to 15 investors is likely to take the shareholding of Poplar Road Ltd Partnership, with one share reserved by dairy-farm investment company MyFarm for smaller investors.
The 181-hectare irrigated property with a 168ha milking base is being offered to a new syndicate after several major investors opted to sell their investment.
MyFarm put the farm on the market, but when it did not sell they offered it to a new group.
The six investors were getting out for genuine reasons, said national sales manager Grant Payton. A German fund investor wanted to realise its returns and another investor wanted to expand another farm operation.
The investors stood to make a total return of 10 per cent on their investment and the farm was being syndicated again because there was still value, he said.
"Canterbury is an area where we have struggled to find farms of this quality for sale with this type of water systems.
"The farm has good surface water off the Mayfield Hinds Irrigation scheme and a 7ha storage pond for 11 days of storage.
"It's a big selling point and we are finding investors are interested in water security."
The Poplar Road farm is fully irrigated, with 90 per cent under centre pivots, and is expected to have 635 cows at peak milking and producing a targeted 280,000 kilograms of milksolids. The investment includes the land, stock and 300,000 Fonterra shares valued this week at $7.10 each.
Payton said MyFarm would introduce a Collective Investment Vehicle (CIV) for the Poplar Road syndication made up of $20,000 investors combined into a single shareholding of more than $2m.
The offer would make owning part of a farm accessible to smaller investors, including city people, lower-order sharemilkers and dairy-farm managers.
"The CIV will be open to everyday mum and dad investors."
MyFarm's portfolio is up to 47 dairy farms - eight in Canterbury - and four sheep and beef farms in the North Island.