All-Australian consortium withdraws bid for cattle empire

CANBERRA, Australia (AP) " An all-Australian consortium on Friday withdrew its bid to buy Australia's largest cattle empire after the country's richest woman announced that she was prepared to buy it outright without a Chinese partner.

Gina Rinehart said on Thursday she is prepared to pay the entire 386.5 million Australian dollars ($294 million) for the country's largest private landholding, S. Kidman & Co. Ltd., if regulators block her Chinese partner, China's Shanghai CRED Real Estate Stock Co. Ltd., from buying a 33-percent stake.

The Australian consortium compromising four cattle families known as BBHO made a counterbid last week of AU$386 million. The bid was championed by lawmakers opposed to any foreign ownership of farmland. BBHO, representing the Buntine, Brinkworth, Harris and Oldfield families, announced on Friday it had withdrawn its bid.

The Australian government announced in May that the collection of 10 cattle ranches, a bull breeding stud and a feed lot covering 101,411 square kilometers (39,155 square miles) in four states would never be to sold to foreign interests, after vetoing a second Chinese-led bid.

The Australia-China consortium, Australian Outback Beef Pty. Ltd., on Thursday bettered the BBHO bid by AU$500,000.

But crucially, Rinehart said her company Hancock Prospecting Pty. Ltd. was prepared to buy the entire cattle empire if regulators in Australia or China rejected the Chinese stake.

"I stand behind the bid and should ... approvals not be achieved, then Hancock will proceed with the acquisition on a 100 percent basis," she said in a statement.

"We have the money to invest to properly maintain the stations and their hard-working staff," she added.

Observers said Rinehart had shown that buying the cattle properties was a priority and that she was prepared to use her abundant wealth to get it.

Kidman directors have recommended shareholders accept the Australian Outback Beef bid if there is no better offer.

"We congratulate the Hancock-Shanghai CRED consortium for similarly recognizing the potential of the iconic Kidman brand," BBHO said in a statement.

"Should they be successful in completing the acquisition, we look forward to welcoming them as neighbors," it added.

China-based Dakang Australia Holdings withdrew its application to buy an 80 percent stake in the family-owned company, founded by beef baron Sir Sidney Kidman in 1899, after the government's announcement in May that the sale was contrary to national interest. The properties cover an area bigger than South Korea and almost the size of the U.S. state of Virginia.

Foreign ownership of farmland is an increasingly sensitive issue in Australia, where many fear that Chinese-owned farms could supply Australian-grown produce to Chinese parent companies at discount prices or refuse to sell to Australian buyers.

But Australian investors such as Rinehart see a Chinese partner as an advantage in expanding exports to the world's most populous country.

This story has been automatically published from the Associated Press wire which uses US spellings

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