Australia‘s richest woman Gina Rinehart on Tuesday defended her joint bid with China’s Shanghai CRED Real Estate for the nation’s biggest cattle empire, after it was trumped by a rival all-Australian syndicate.
Rinehart’s Hancock Prospecting issued a statement detailing the virtues of her A$365 million ($278 million) offer with Shanghai CRED for S. Kidman and Co, hoping to counter any concerns about foreign ownership.
Kidman Managing Director Greg Campbell said Hancock remains the preferred bidder and has the right to match any rival offers, but added the A$386 million BBHO offer would be fairly evaluated once fully lodged.
“It will be a balancing act of sentiment and history and price in the minds of the shareholders,” he told Reuters by phone.
The sale of Kidman, which has an average beef herd carrying capacity of 185,000 cattle and grazing rights to a South Korea-sized swathe of land, is under the microscope amid Australia‘s increasingly protective stance against foreign takeovers in its agricultural sector.
Domestic ownership of agriculture, seen as crucial for the country to cash in on global food demand and to keep tax revenues onshore, has become a hot political issue. The BBHO bid has the advantage of not needing approval from Australia‘s foreign investment review board.
“The Hancock JV bid is an Australian bid, you don’t get much more Australian than fourth generation Australian Gina Rinehart, so let’s not start to pretend otherwise,” Hancock Chief Executive Garry Korte said in the statement.
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“The real difference between the bids is that we will maintain and secure the future of the Kidman legacy, invest in the stations and avoid seeing it split up and destroyed.”
That contrasts with the BBHO bid, comprised of the Brinkworth, Buntine, Harris and Oldfield wealthy grazier families, which plans to break up the Kidman lands to share between them.
The Rinehart-CRED bid excludes two large defense-sensitive Kidman properties, Anna Creek and The Peake, which are adjacent to a government weapons-testing range. A Rinehart spokeswoman, Sophie Mirabella, said on Monday that exclusion and a “break-fee” of A$3.8 million if Kidman ditches the Rinehart-CRED bid leaves the dueling bids valued “about the same.”
The Australian government has twice rejected foreign offers for Kidman, including a previous bid by Shanghai CRED and China’s Hunan Dakang Pasture Farming that had a minority Australian interest.
The BBHO proposal would keep the 100-year-old Kidman name for marketing purposes but split up the vast properties, with various pieces to be absorbed in to the bidding families’ existing cattle runs.