Mud House vineyards sold overseas for $46m

CATHIE BELL
Last updated 08:32 06/05/2014

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The new owners of Marlborough-based Mud House Wines' brands paid more than $46 million for the wine company's land, according to information from the Overseas Investment Office.

The decision summary made public by the government agency that oversees the sale of sensitive land to foreign purchasers says QWIL Investments (NZ) Pty Limited bought a freehold interest in five vineyards of 596 hectares in Marlborough, Canterbury, and Otago, and Accolades Wines New Zealand Limited bought a leasehold interest in the same land.

The sale was announced in November last year and confirmed on April 1, but the sale price was not revealed.

The former Mud House vineyards have been sold to QWIL Investments, but will continue to supply grapes to Accolade. The grapes will be processed at NZ Wineries, Mud House Wine Group's contract winemaking business, based at Blenheim's Riverlands industrial estate. The winery has been retained by the company, now called MHW.

The Overseas Investment Office said the sale price was $46.4 million.

That seemed low, working out at about $77,850 a hectare, but the Marlborough Express understands that was just for the land alone, and didn't include the price for the winery business and label brands.

QWIL Investments is owned by Hong Kong interests, including billionaire Li Ka-shing, who has diverse business interests in New Zealand. These include a part-ownership in the Dominion Saltworks in Grassmere and waste businesses in Christchurch and Auckland.

Harcourts rural, commercial and property manager Tom Rutherford said the vineyards' sale price had to be market price to get Overseas Investment Office approval. It was very hard to regionalise the price between different areas, he said.

A vineyard owner might say the price was "ridiculously low" but a pastoral farming owner would say it was "ridiculously high", Rutherford said.

Prices in Marlborough were about $175,000 for Wairau vineyard land, but grazing land was fetching $25,000 a hectare and forestry about $15,000, he said.

There was still a huge amount of interest out there in Marlborough vineyard land, Rutherford said.

"Marlborough is still seen as a good place to invest."

The Overseas Investment Office decision summary said QWIL Investments and Accolade Wines intended to continue to operate and develop the vineyards and various wine businesses related to the land.

"The investment will enhance QWIL's existing investments in [and will provide Accolade Group with an entry into] the New Zealand wine industry."

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It said the sale met the "substantial and identifiable benefit to New Zealand" criteria as it would retain and possibly create jobs, increase export earnings, improve productivity and efficiency, and provide additional investment for development.

- Marlborough

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