Cattle Station

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The rural property trust, Rural Funds Group has bought Cobungra Station for $35 million.

Cobungra Station – one of Victoria's largest and most prestigious high-country beef breeding enterprises – was offered for sale last April.

It was for only the third time in 100 years.

The $35 million deal secured the 6486-hectare alpine beef property at the foot of Mount Hotham, plus more than 24,000 hectares of adjacent grazing licences.

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Cobungra Station has a history and reputation as a grower of high quality Australian beef stretching back to the 1800s.

Its cattle comprises Full Blood Wagyu, F1 Wagyu Cross and English Breed herds.

In 2001 a comprehensive full blood wagyu breeding programme commenced, starting with a herd of 70 cows descended from Michifuku bloodlines. Since then the Cobungra full blood wagyu herd has developed substantially.

At between 1000m and 1500m above sea level, the altitude and clean mountain air, combined with abundant clean water makes a naturally healthy place to raise cattle. 

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Cobungra Station's Wagyu product is distributed under the award-winning “Blackmore Wagyu” label.

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Stone Axe Pastoral Company, a Wagyu producer that leases two other properties from RFF, has entered a ten-year lease with a rent review in year five.

The <a href="https://www.realestate.com.au/property-livestock-vic-omeo-7952550" target="_blank">1929 Great Alpine Road, Omeo property</a> was offered through Elders and Colliers.

<h2>VIC properties now selling:</h2>

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[smartcode_project:default project_id=27427]

[smartcode_project:default project_id=25409]
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Rural Funds Group buys Cobungra Station for $35 million

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The Federal Treasurer Scott Morrison has delayed any potential sale of the Kidman &amp; Co cattle empire to Chinese interests until after the federal election so as to thoroughly assess the transaction’s national interest merits.
It was revealed Australian Rural Capital (ARC) was providing a 20 per cent local stake in a Chinese-led joint-venture deal to buy the massive pastoral business which covers 2.5 per cent of the nation’s agricultural land for $370 million.
Shanghai Pengxin would indirectly control 80pc of the business that currently covers about 11m hectares in Queensland, SA, NT and WA.
The offer needs <a href="/news/52567-kidman-sale-to-shanghai-pengxin-syndicate-nears" target="_blank">Foreign Investment Review Board (FIRB) approval</a> and Mr Morrison’s consent.
He’d signed an order last Friday which prohibits the Kidman transaction from proceeding for a period of 90 days from the gazetted date, meaning any final call of Kidman is likely to occur after polling day.
Mr Morrison said the order provided further time for him to consider the national interest implications “of this complex and sensitive acquisition”.
“My obligation is to make careful and detailed assessments of foreign investment proposals against the national interest and that is exactly what I intend to do on the Kidman matter as I did on the previous consideration of that transaction,” he said.
“National interest considerations of proposed transactions should not and will not, on my watch, be rushed, on important matters such as this.”
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Kidman sale to Chinese interests delayed

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Despite suggestions Ernst &amp; Young is close to selling the Kidman family’s ­vast cattle estate, new potential buyers have reportedly emerged.
The Melbourne based Fox family who own Linfox have been pinpointed as a late interested party.
Fairfax Media suggested the $3 billion Linfox logistics empire founded by trucking magnate Lindsay Fox - now largely run by three of his sons Peter, Andrew and David - had the desire and financial capacity to lodge a serious bid for Kidman.
Andrew Fox runs the company’s property division and is understood to have held recent talks with senior government officials about making a potential offer.
The preferred Hunan Dakang bidders had been thought as set to re-emerge with an Australian partner to buy all the Kidman property except the defence sensitive Anna Creek at a price a little below the original bid at $370 million.
Australia's biggest private rural landholding, which includes the world's largest cattle station, is up for sale by the pioneering pastoralist company, S. Kidman and Co. 
Eleven cattle stations covering more than 100,000 square kilometres are being offered through Ernst and Young Adelaide.
S. Kidman and Co. is 98% owned by members of the Kidman family, represented by 58 shareholdings. Not all wanted to sell, The Land reported earlier this year, adding last financial year the company reported a net operating cashflow of $9.3 million and paid dividends of 20 cents a share. 
But it recorded a net after tax loss of $1.4m as herd numbers declined 15 per cent because of tough seasonal conditions to 182,350 head, and their livestock market value fell about $10 million to $97.4 million.
The cattle king Sir Sidney Kidman's first purchase was in 1886: Owen Springs south-west of Alice Springs.
The business still has cattle stations across Western Australia, the Northern Territory, Queensland and South Australia. 
Anna Creek Station in South Australia's outback, with defence security proximity concerns, is the largest at 23,000 square kilometres. 
The other holdings include Helen Springs in the Northern Territory and Ruby Plains in Western Australia, Durham Downs, Durrie, Glengyle, Morney Plains, Naryilco and Rockybank in Queensland; Innamincka, Macumba and Tungali in South Australia where the company is headquartered.
Property Observer first reported the S.Kidman first cattle empire was set for sale on 14 December <a href="/news/49336-s-kidman-cattle-empire-set-for-sale-to-same-chinese-bidders" target="_blank">here</a>.
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Fox family keen on Kidman farms?

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Some $14 million has been paid for a Roma farm by Tom Strachan, the owner of Australia's largest privately owned labour hire company AUX.
The 7300-hectare Lighthouse station borders his current rural property holding, Lorraine.
"It's champagne country that you can't get enough of," Mr Strachan told The Australian Financial Review.
The new cattle station purchase was made through his Australian Pastoral Land Company, which is separate from the labour hire business.
The Lighthouse property was formerly owned by the estate of Dr Jim Baker who acquired it in 1975 during the "Beef Depression".
Mr Strachan's wealth is estimated by the BRW Young Rich List at $47 million.
The property, was offered to the market alongside the neighbouring Meeleebee Downs, which is in due diligence with a separate buyer.
CBRE's Danny Thomas, Chris Holgar and Geoff Warriner negotiated the sale.
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Roma Lighthouse station farm sold to Tom Strachan

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Chinese billionaire Xingfa Ma has bought Wollogorang and Wentworth cattle stations on the Gulf of Carpentaria for $47 million.
Listed as one of the top 400 wealthiest men in China, according to Forbes, he already has agricultural WA land including Balfour Downs and Wandanya stations along with Ferngrove Wine Group and Emu Downs Station.
The newly acquired 705,700 hectare station comes with 40,000 head of cattle, the Australian Financial Review reported.
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Wollogorang and Wentworth cattle stations sell for $47 million

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The London based M.P. Evans Group has sold its 31,000 hectare cattle-fattening property Woodlands, near Westmar in Queensland, for $28 million to the Fucheng Group.
The sale is conditional on Foreign Investment Review Board approval.
The group's core strategy is to continue to expand its oil-palm areas in Indonesia, in a sustainable and cost-effective manner. 
Its statement to the London Stock Exchange, M.P. Evans, advised its board determined some time ago, for strategic reasons, to sell Woodlands but significant interest in the property had only developed in recent months further to the sharp strengthening of the cattle market.
Woodlands reported a farm profit for the year ended 31 December 2014 of US$0.2 million.
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Queensland cattle farm sold by English investors to Chinese

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The Federal Government will block the sale of Australia's largest cattle property portfolio, S. Kidman &amp; Co, to foreign buyers.
Treasurer Scott Morrison said in a statement he had decided that an acquisition of the company by a foreign buyer would be contrary to the national interest and he would not authorise it.
The family-owned S. Kidman &amp; Co is Australia's largest private landholder with properties covering 101,000 square kilometres in Western Australia, South Australia, the Northern Territory and Queensland.
Around $350 million had been sought.
Founded in 1899 by Sir Sidney Kidman, it is now one of the country's largest beef producers with a herd of 185,000 cattle, supplying markets in Japan, the United States and South-East Asia.
"Consistent with the recommendation from the Foreign Investment Review Board (FIRB), I have decided that the acquisition by foreign investors of S. Kidman and Co. Limited would be contrary to the national interest and shall not be authorising the sale to proceed as currently proposed," he said.
"Importantly, around 50 per cent of the Anna Creek pastoral lease is located in the Woomera Prohibited Area (WPA) in South Australia.
"The WPA weapons testing range makes a unique and sensitive contribution to Australia's national defence and it is not unusual for governments to restrict access to sensitive areas on national security grounds.
"Given the size and significance of the total portfolio of Kidman properties along with the national security issues around access to the WPA, I have determined, after taking advice from FIRB, that it would be contrary to Australia's national interest for a foreign person to acquire S. Kidman and Co. in its current form.
"I note that following communication of my decision all bidders to acquire S. Kidman and Co. Limited have elected to withdraw their FIRB applications prior to my Final Order being formalised."
S. Kidman &amp; Co's managing director, Greg Campbell told the ABC he was surprised by the Government's decision to block the sale.
"To be honest I didn't think this would be the outcome.
"I knew there would be concerns, however cyber espionage around the world seems to operate quite successfully in its own right without the need to acquire an outback cattle property like Anna Creek."
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Foreigners banned from buying $350 million S.Kidman farm

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Billionaire property entreprenuer Brett Blundy has paid around $100 million for the Walhallow cattle station aggregation in the Northern Territory.
It was the largest single cattle station deal in Australian history, The Australian Financial Review suggested of the sale of the one million hectare property on the Barkly Tablelands by Macquarie Group's Paraway Pastoral.
The walk in-walk out deal included 48,000 head of cattle, worth more than $40 million, with the estimated land component worth around $56 million.
Blundy's purchase was made with pastoralists Adrian and Emma Brown.
Macquarie purchased the aggregation from cattle baron Peter Hughes in 2009 as part of a larger portfolio.
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Brett Blundy buys Walhallow, the NT cattle farm

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The willingness of more than 4,500 mum-and-dad investors to commit more than $70 million to acquire a stake in the iconic S. Kidman &amp; Co pastoral holding is proof of the retail appetite for investment in agricultural assets.
Arthur Naoumidis, chief executive officer of property crowd-funding company DomaCom, said in the group’s submission to the inquiry into the foreign investment review framework by the Senate Economics References Committee that this was the only conclusion that could be drawn from the public interest in Kidman, and that should be encouraged.
He said the widespread interest in Kidman has been spawned by two inter-related themes: the public’s desire not to see rural property (as distinct from rural businesses) sold overseas and the realisation that it was a good defensive asset suited to most investment portfolios. 
Barnaby Joyce, the Federal Agriculture Minister, had last year called for a <a href="/news/43455-barnaby-joyce-doesn-t-want-s-kidman-to-fall-into-sovereign-government-hands" target="_blank">veto on foreign governments being allowed to buy Australian farmland</a>. The comments followed as the Kidman cattle empire is for sale. 
“Although the value of agricultural land fluctuates in line with the highs and lows of climatic changes, such as drought, it attracts reasonable yields and enjoys capital gain," said Naoumidis.
“In our opinion, domestic investment into agricultural assets has the potential to be a significant game changer in the rural sector as the replacement of debt with long-term investment equity not only provides stability to rural enterprises but can substantially reduce the debt servicing load for the operating business."
Naoumidis listed several benefits, such as more robust business structures by a reduction of debt servicing, the ability to reinvest by the operator into operating assets such as cattle, feed expansion, equipment for improvement, thus enhancing the outcome of greater revenue to increase equity or for expansion.
“Business is increasingly looking to rural land, just as foreign interests are, and we should be encouraging our $2.1 trillion superannuation industry (including the SMSF sector) to increase their exposure to a 2.5% asset allocation from the current 0.3%”.
“Investment in our agricultural sector will encourage young people to stay on the land, particularly if equity capital can be crowdfunded through investment channels to give relief in the often never-ending cycle of debt that many on the land face while trying to increase productivity.
“Co-investment instead of debt leads to equity-based succession planning that is more attractive to next generation of owners and would encourage many young people to stay on the land.”
Naoumidis said there seemed to be disconnect between Australian fund managers and their overseas counterparts who clearly see a benefit in the agricultural industry.
DomaCom Australia Limited helps SMSFs acquire property through the fractional acquisition of units in a unique trust structure that enables investors to choose the property they want, it says.
It says the government must encourage more domestic investment, in spite of some failures over recent years in the agri sector, mainly because they were tax-driven schemes without the backing of solid assets such as the land. They were also heavily geared.
 
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4,500 mum-and-dad investors commit more than $70 million for stake in S. Kidman & Co 

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Shanghai Pengxin and its partner Australian Rural Capital have been assigned preferred bidder status for Australia's largest rural landholder, S.Kidman &amp; Co. 
It followed a Kidman &amp; Co board meeting last week. 
The Foreign Investment Review Board has yet to make a decision on their rumoured $350 million bid. 
S. Kidman &amp; Co is Australia's largest private rural landholder spread across 11 cattle stations in South Australia, Western Australia, the Northern Territory and Queensland.
FIRB rejected an initial offer from Shanghai Pengxin last year with its standalone offer after concerns were raised about its proximity to the Woomera weapons testing range in South Australia. 
Pengxin now has a local partner, Australian Rural Capital, which is expected to manage the land should the bid be successful.
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