Farmers expect Crafar bid to succeed

Photo / Christine Cornege

An announcement on the controversial Crafar farms deal is expected today.

Federated farmers president Bruce Wills said an announcement was due and he believed the bid for the 16 farms in receivership by Chinese investors Shanghai Pengxin would be successful.

Mr Wills said rural New Zealand had about $47 billion of debt and the sale wasn't necessarily a bad thing.

He told Radio New Zealand there had been concern about farms being sold off in large blocks but critics should acknowledge the debt and the benefits the sale could bring.

Shanghai Pengxin will not rule out selling some of the farms to New Zealand groups which mounted a rival bid.

There was speculation Shanghai Pengxin had agreed to sell at least two of the 16 farms to Maori groups.

Cedric Allen, a spokesman for Shanghai Pengxin subsidiary Milk New Zealand, would not confirm it, saying it would be premature because the company did not own the properties.

"If the decision is favourable, obviously we'll be talking to the relevant iwi, but it's way too early to comment on anything like that.''

He denied it was something the company had suggested to increase its chances of getting approval.

"We've always been very open to talking to iwi and other community groups, but we have maintained an attitude right through of saying we'd love to talk to you when we know we've got the farms.

"Up until we know we own them, there's not a great deal of point.''

Mr Allen said he had not yet been advised of when the ministers might announce their decision.

There are two iwi groups in Sir Michael Fay's consortium which challenged the initial approval of the purchase in the courts in January, resulting in the High Court sending the matter back to the Overseas Investment Office (OIO) to reconsider.

A spokesman for that group said it did not know of any such deal.

"They'd be delighted, but it will come out of the blue.''

OIO manager Annelies McClure said questions on whether Shanghai Pengxin had indicated it was willing to onsell farms should be directed at to Milk New Zealand.

Labour's finance spokesman, David Parker, said it would be disturbing if the Government was involved in broaching any such deals behind closed doors to try to make the sale more palatable.

"We've had a non-transparent process that's already taken close to a year ... and if there are signs that there might be side deals going on is just bad practice.''

The two ministers had accepted a recommendation by the OIO in January that the purchase go ahead.

But that decision was sent back to the OIO by the High Court, which said the office had not applied an appropriate test of whether the overseas company could offer more benefits than a New Zealand investor.

Under Shanghai Pengxin's bid, Landcorp would manage the farms - something it has likened to a sharemilking arrangement.