Crafar in farm buy-back bid

Allan Crafar. Photo Christine Cornege

The former head of New Zealand's biggest private dairy operation is expecting to be able to pull an offer together for receivers this week, but admits he's got no idea whether it will be enough to stave off receivership.

Allan Crafar says he is considering "three very good options", which he hopes to be able to present in the next few days.

Earlier, he said he was locked in talks with overseas interests in an attempt to trade his way out of debt.

However he is unsure whether it will be enough for him to take back control of the farms, because he says he is being kept in the dark by receivers concerning details of a conditional sale agreement of the farms announced last week.

"I have already told them (the receivers) on two occasions that I'm in the process of getting the money to redeem my debts and that I want a statement - I haven't been given an accurate statement of what is required to do that."

Receivers KordaMentha said on Friday they had signed a conditional sale agreement with the Chinese-backed company UBNZ Holdings who want to buy the 16 Crafar farms.

Crafar said he had not been told what that offer entailed, and therefore had no way of know whether the funds he was seeking would be enough.

The offer is subject to Overseas Investment Office (OIO) approval and can be overtaken by a better offer before tenders close in a month.

In April the OIO sent back an application from Natural Dairy NZ seeking more information about its proposed purchases.

It is still waiting for Natural Dairy to re-submit that application which, could take up to 50 working days to be processed.

Public relations representative Bill Ralston said he anticipates the application will be with the OIO this week.

A spokesperson for the office said the OIO was not aware a conditional sale agreement of the farms had been reached, prior to it being announced last week.

Asked whether the OIO investigation into four other Crafar farms purchased by UBNZ last year, had the potential to derail the conditional sale agreement, the OIO said it was too early to comment.

Being granted consent for one transaction, did not automatically mean that consent for other transactions would be granted, a spokesperson for the office added.

Agriculture Minister David Carter told delegates at the National Mainland Conference at the weekend, that he did not believe the applications will be approved.

The company would need to prove it was a good corporate citizen and that the deal would be of net benefit to the country.

He believed it was unlikely to be able to do so, the Timaru Herald reported.

The Crafar dairy empire went into receivership last October, owing more than $200 million to PGG Wrightson, Westpac and Rabobank.

Crafar said he had received correspondence from the receivers that the debt now topped $230 million, including $15 million in receivership costs and $13 million in "bank costs".

KordaMentha could not be reached for comment about the figures.