Newly-listed New Zealand Rural Land Co (NZL) has bought its first farm - a 456ha dairy farm in Mokoreta, Southland, for $10.37 million.
The company said the purchase, which has a June 1 settlement date, was the first in a series of expected acquisitions.
NZL said the agreement remains conditional on a successful test of an effluent pond on the farm.
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The company has agreed the terms of a lease for the farm with Invercargill-based dairy company Fortuna Group - which will start from settlement.
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The lease is for 10 years with a rental of $515,667 a year, representing a 4.97 per cent per annum lease yield, after transaction costs.
"This acquisition is consistent with NZL's stated plans and tenant requirements at the time of the initial public offer in December 2020," the company said.
"NZL continues to work on several larger-scale acquisitions of dairy farms in the South Island and expects to complete those negotiations in the ensuing weeks with earlier settlement dates than traditional dairy farm settlements (June 1)."
The company said successful conclusion of those negotiations would see NZL generate lease income prior to its June 30, 2021, balance date that would be earlier than indicated in its IPO documents.
NZL said it is talks with debt funders to establish funding lines for these further acquisitions.
Shares in NZL debuted on December 21 $1.31, a 4.8 per cent premium to the stock's $1.25 issue price.
NZL's shares last traded at $1.19, up 5c from Monday's close.