Chinese company Shanghai Pengxin has put a "ridiculously" high price on three recently purchased former Crafar dairy farms in the central North Island, the iwi groups seeking to purchase them for cultural reasons say.

The Tiroa E and Te Hape B Trusts representing King Country iwi Ngati Rereahu were part of the Sir Michael Fay led group which competed against, but lost to Shanghai Pengxin in a bid to buy the 16 former Crafar dairy farms this year.

However, the trusts have been in negotiations to buy two farms at Benneydale south of Te Kuiti, while Tuwharetoa representatives who were also part of the Fay group have been negotiating to buy a farm at Tauhara on the Napier Taupo highway.

Chairman of the Ngati Rereahu trusts Hardie Peni, said he had been negotiating in recent weeks with Landcorp which is to run the former Crafar farms for Shanghai Pengxin.


The Chinese company is believed to have paid just over $200 million for all 16 farms.

However Mr Peni said Landcorp had in recent days said it wanted a deal with the two iwi signed by tomorrow, conditional on both iwi withdrawing from the Appeal Court process on Monday challenging Shanghai Pengxin's purchase.

"However, the price being offered to us, $66.5 million for just three of the 16 farms, was ridiculous."

He said Landcorp and Shanghai Pengxin were seeking the $37.5 million for the Benneydale farms which he believed were worth about $23 million. The $29 million sought for the Tauhara farm was also significantly above the $22 million offered by the Tauhara buyers in the Crafar Farms Purchase Group.

The Fay Group is appealing Justice Forrest Miller's High Court ruling that with support from Landcorp, Shanghai Pengxin has the necessary expertise and acumen to operate the farms as required under the Overseas Investment Act.

The appeal is due to be heard on Monday.

"The timing of this offer is very significant and I have little doubt it was an attempt to undermine our buying group ahead of the court appearance," Mr Peni said.

Ngati Rereahu and Tuwharetoa have had claims on the land where the three farms are located since the 1800s and saw the potential sale "as an opportunity to reclaim the land and a number of wahi tapu sites through a commercial transaction" Mr Peni said.