Gina Rinehart-led consortia bids for Kidman Estate after Chinese bid blocked – October 2016

Filed under: Trade and industry, Agriculture, Investment, Mining,

Mining magnate Gina Rinehart has joined with Chinese real estate firm Shanghai CRED to bid $365 million for Australia’s largest private landholding, S Kidman & Co.

They have made the bid through joint venture company Australian Outback Beef Pty Ltd (AOB).

The company is 67 per cent owned by Hancock Prospecting and 33 per cent owned by Shanghai Cred.

Following the Rinehart-led consortia bid, an all-Australian consortia led by West Australian and Northern Territory pastoralist Sterling Buntine said it also intended to lodge a bid – for more than the Rinehart offer.

Kidman is one of Australia’s largest beef producers, with an average carrying capacity of 185,000 cattle and pastoral leases covering 101,000 square kilometres across South Australia, Western Australia, the Northern Territory and Queensland.

Treasurer Scott Morrison has earlier this year twice rejected all-Chinese bids for all and part of the Kidman empire on “national interest’ grounds.

The Hancock family started their first cattle station in North West Australia and Mrs Rinehart has grown the portfolio ever since. “Kidman is an iconic cattle business established more than a century ago by Sir Sidney Kidman,” said Mrs Rinehart. “It is an operation founded on hard work and perseverance by an outstanding Australian, and is an important part of Australia’s pioneering and entrepreneurial history.”

Shanghai CRED principal Mr Gui Guojie said partnering with Hancock had already proved to be a productive approach and he looked forward to working with Mrs Rinehart’s firm.

Hancock Prospecting noted in a statement that should the transaction be completed, the level of foreign ownership of Kidman would slightly reduce from the existing level of 33.9 per cent.

More than 600 interested parties have held discussions with sale manager Ernst & Young since the Kidman landholding went on sale almost 18 months ago.

The AOB bid will be subject to approval from Australia’s Foreign Investment Review Board and the Chinese government.

Garry Korte, CEO of Hancock, said: “The quality of the Kidman herd and channel country properties complement Hancock’s existing northern cattle properties, and align well with Mrs Rinehart’s plans to build a diversified cattle holding in Australia, taking advantage of integration opportunities.”

Chairman of Kidman John Crosby said Kidman shareholders were pleased with the arrangement.

“We welcome the significant investment proposed in addition to the purchase price and are confident that the Kidman business will be in good hands”, he said.

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