New Chinese company bids for New Zealand dairy farms

Jan 27, 2011, 0:50 GMT

Wellington - China's Pengxin International Group Limited of Shanghai is seeking to buy 16 New Zealand dairy farms following the Overseas Investment Office's rejection of a bid by a Hong Kong company, it was announced Thursday.

A spokesman for KordaMentha, receivers for the farms that were liquidated more than a year ago owing about 200 million New Zealand dollars (154 million US dollars), said: 'It's by far the best offer we have, and it is now a matter of waiting for OIO approval.'

The offer price was not disclosed.

A bid for the farms by Hong Kong-registered Natural Dairy (NZ) Holdings Ltd was rejected last month after the OIO said the company's directors, including front woman May Wang, who is a New Zealand citizen, had failed the required 'good character' test.

The Serious Fraud Office launched an inquiry into the company, and May Wang was declared bankrupt after another company failed and faces charges under the Companies Act.

The proposed deal for the first Chinese bid to buy into the New Zealand dairy industry, which is the country's biggest export earner, has been highly controversial.

Prime Minister John Key has said that New Zealanders do not want to end up as 'tenants in their own country,' and the government tightened regulations governing foreign purchases of farms.

In a statement released by KordaMentha, Pengxin Chairman Jiang Zhaobai said the company would lodge its application in March with the OIO to purchase the properties.

Declining to release details of the company's plans before then, he said: 'What we can say at this stage is that we believe we will bring substantial benefits to New Zealand, some of them, perhaps, outside the dairy industry.'

He said the group, which employs about 4,000 people, had total assets of 2 billion US dollars, with four business arms including property development, infrastructure, mining and agriculture.

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