Chinese could blow deal - iwi

ANDREA FOX
Last updated 08:17 15/10/2012

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Central North Island iwi say aspiring Crafar farms buyer Shanghai Pengxin now has to make a choice over selling two of the farms to them at market valuation, or risk losing the whole 16-farm purchase deal if an iwi court challenge is upheld.

Two iwi land trusts, Tiroa E and Te Hape B, which have for more than a year been trying to negotiate with the Chinese to buy two farms considered ancestral land at Benneydale, presented a new purchase heads of agreement last week to Shanghai Pengxin's New Zealand agent, trusts chairman Hardie Peni said.

Last month the trusts filed a challenge to the in-receivership Crafar farms sale to Shanghai Pengxin in the Supreme Court. The trusts would withdraw the court action if the proposed agreement was signed.

Peni said he had had no response from the Chinese.

He said if the iwi challenge was upheld "the whole deal could fall over" for the Chinese company.

"If they want to take that gamble in a commercial decision, that's OK."

Some negotiations with Shanghai Pengxin's agent still had to be completed, Peni said.

The trusts had yet to receive a court date, but Peni said a judge may just consider the iwi challenge on face value and dismiss or decline it.

The heads of agreement requires any sale of the two Crafar farms at Benneydale to iwi to be based on a market valuation.

In a previous negotiation, the Chinese company agreed to sell the two farms to the trusts for $66 million, a price iwi rejected as much too high.

Shanghai Pengxin is understood to have negotiated with receivers KordaMentha to buy the whole 16-farm portfolio for about $210m.

The Crafar dairy farm estate has been in receivership for nearly three years.

The iwi court challenge is the latest twist in a sale saga that has seen two Overseas Investment Office and Beehive consents to the Chinese purchase, and court challenges by a group of Kiwi farmers, including the iwi trusts, led by businessman Sir Michael Fay which have had mixed success, but were ultimately unsuccessful in stopping the proposed sale to Shanghai Pengxin. Fairfax NZ

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- © Fairfax NZ News

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