Chinese company Shanghai Pengxin's bid to buy the Crafar dairy farms passed its final legal hurdle today after an attempt to block the deal in the Supreme Court was dismissed.
King Country iwi Ngati Rereahu last month initiated a Supreme Court challenge against the approval for the purchase of the sixteen farms granted by the Overseas Investment Office, associate Finance Minister Jonathan Coleman and Land Information Minister Maurice Williamson.
However the court refused to hear the case saying the claim relied on an examination of the Overseas Investment Act's provisions around the buyers' required business acumen and experience.
The ministers' decision to approve the deal the involved "matters of fact and degree rather than the true meaning of the statute" the judges who considered the application said in their decision.
Shanghai Pengxin first indicated it wished to buy the farms in January last year after a previous Chinese backed bid was rejected on the OIA's good character provisions.
Shanghai Pengxin said it was delighted the court had removed the final obstacle to purchasing the farms by the end of the year after an "unbelievably protracted process''.
The company was looking forward to a positive relationship with the dairy industry and local communities.
"Over time, we hope we will demonstrate many benefits in New Zealand and China working together and maximising the opportunities available for New Zealand's largest industry in China.''
The farms will be bought by Shanghai Pengxin subsidiary Milk New Zealand Holding Ltd, and run by a joint venture with Government-owned Landcorp, which will be the managing partner.
Landcorp chief executive Chris Kelly said the next step was to review the assets and herds before taking over the management and sharemilking contracts from the receiver.
"All going well, we expect to take over the running of all the farms early in December,'' he said.
The company's priorities include upgrades to meet increased production targets, environmental upgrades, and the establishment of a dairy training school on one of the properties.
The joint venture was looking to spend some $15.7 million on the properties in the first three years.
It would continue to supply milk to Fonterra at first but would also work towards processing milk to create a range high value consumer products for sale in China - either by contract or through a joint venture.
The company would spend $100m on marketing its products in China in its first five years.
Shanghai Pengxin spokesman Cedric Allan said directors and chairman would be announced shortly.