After being placed on the market only this February, Western Australia’s South African Western Australian Pastoral Company (SAWA) aggregation of cattle properties has been acquired by a new investment group established by Adelaide-based advisory firm, Agrify, in a deal reported to be valued at $100 million.
Consisting of more than one million hectares, the Kimberly assets include the Moola Bulla station with 395,000 hectares, the Mt. Amhurst station with 260,000 hectares, Beefwood Park with 206,000 hectares and the Shamrock station with 178,000 hectares.
This deal, which The Australian reports as being the largest rural deal in Western Australia history, marks an impressive debut for the newly formed Agrify investment group which is being backed by unnamed international equity. The SAWA acquisition will serve as the cornerstone for the Agrify fund, which is targeting expansion through complimentary acquisitions as they become available.
“Strategy is to develop the SAWA property aggregation as a priority and consider other acquisitions as opportunities present themselves,” Agrify Partner, Dale Champion told GAI News. “In an operational sense, our preference will be to partner with existing Australian operators but of course finding the right people with complimentary views and vision is not always simple, so we’re patient and will consider options as we move forward.”
Combined, the SAWA aggregation is currently running approximately 47,000 branded cattle, according to Beef Central. The central geographic location of the properties to both Broome and Wyndham, the region’s two main live export locations, provides the buyer with a natural, existing supply chain for the 16,000 head of young cattle expected to be ready to leave the operation for export this year. It was this strategic location and quality of the assets, together with the significant further development opportunities that exist that were the drivers for the acquisition according to Mr. Champion.
The deal is subject to pending approval from the Foreign Investment Review Board (FIRB) and approval from state government regulators, however, it comes at a point when strong overseas demand for Australian beef and record prices are resulting in a flurry of deals within Australia’s cattle sector.
Most recently, S. Kidman agreed to be acquired by a Chinese-led consortium of Chinese and Australian buyers for $370.7 million (US$287.3 million), while the Queensland Investment Corporation (QIC) is reportedly also in the midst of due diligence for the purchase of the North Australian Pastoral Company (NAPCO) in a deal worth $400 million.
“For Australian investors some of the reservation (toward rural assets) is created by a volatile recent history and an uncertainty around the sustainability of (commodity prices), Mr. Champion told The Australian. “Whereas international investors are taking a longer-term perspective and see the value of the Australian commodity on a global stage.”