Australia’s government delayed for 90 days ruling on a second attempt by Chinese investors to buy the giant S Kidman & Co estate, for aus$370.7m ($290m), delaying until after general elections what could be a controversial decision.
Scott Morrison, Australian treasurer, said that the government had issued an interim order to delay the transaction “to consider the national interest implications of this complex and sensitive acquisition”.
“I want to be absolutely confident when I finally consider this matter that Australians have had every opportunity to be participating in that process,” Mr Morrison said.
“National interest considerations of proposed transactions should not and will not be rushed on an important matter such as this.”
The delay will take a decision beyond the July 2 date of general elections.
The comments follow S Kidman & Co’s agreement on Monday to a revised bid from Chinese investors including real estate group Shanghai Pengxin, after an initial offer, reportedly valued at more than Aus$350m, was rejected by Mr Morrison in November.
Mr Morrison justified the refusal in part on grounds that part of the S Kidman & Co estate, in South Australia, was next to a military testing station, adding that he had also acted after taking advice from the official Foreign Investment Review Board (Firb).
“Given the size and significance of the total portfolio of Kidman properties along with the national security issues… I have determined… that it would be contrary to Australia’s national interest for a foreign person to acquire S Kidman and Co in its current form,” he said at the time.
However, S Kidman & Co – which controls more than 100,000 square kilometres of land, and owns some 185,000 head of cattle – said this week that it had “complied with all requests that have been made by the Firb”.
‘Keep Australia for Australians’
The revised consortium also includes, besides Shanghai Pengxin-controlled Hunan Dakang Pasture and Shanghai CRED Real Estate, an Australian investment group, Australian Rural Capital.
Under the deal, Australian Rural Capital, which is listed in Sydney, will purchase a 20% stake in S Kidman & Co.
Even so, despite the Australian participation, the revised proposal has attracted opposition over concerns over the extent of Australian land being snapped up by foreign, and largely Chinese, investors.
National Party senator John Williams said on Wednesday that the government should “keep Australia for Australians”.
Malcolm Turnbull, Australia’s prime minister, said that the proposed deal should be scrutinised very carefully Firb officials, to ensure its benefited Australia’s national interest.
“Where [foreign investment] is not contrary to national interest, it’s able to proceed,” he said.
S Kidman said that the “significant investment proposed by the consortium will see an increase in production, and the expansion of international markets for Kidman beef”.
“We believe the sale will secure the long-term future of the Kidman enterprise.”
(Source – http://www.agrimoney.com/news/australia-delays-ruling-on-$290m-china-backed-mega-ranch-deal–9514.html)