Australia’s largest cattle group and private landholder, S. Kidman & Co. may have another interested Chinese bidder. 

 

Street Talk Online recently revealed that China’s Shanghai Pengxin was in exclusive talks with S. Kidman regarding its bid of $350 million for the cattle group, which operates 10 cattle stations, a stud farm, and feedlots spread across more than 100,000 square kilometers. However, Ernst & Young, the cattle group’s advisor, confirmed that the deal has been delayed due to regulatory procedures.

 

In light of Pengxin’s difficulties in closing the deal, Chinese investment company, Genius Link Asset Management (GLAM), which already owns and operates a portfolio of agricultural assets in Australia, is entering into discussions with local cattle operators regarding a joint bid, and has reportedly directly approached Kidman’s owners.

 

GLAM currently controls Riverina Oils & Bio Energy, Australia’s second biggest oilseed crushing and refining company, and TreeTops Plantations, the country’s largest table olive plantation, which includes 120,000 olive trees.

 

The Kidman purchase will require approval from Australia’s Foreign Investment Review Board (FIRB), and even though large agricultural purchases by overseas buyers have been a politically sensitive topic in both Australia and New Zealand, the pursuit of Australian agricultural assets by foreign investors has not abated – especially within the Australia cattle sector, where free trade agreements with Japan, China, and South Korea, the re-establishment of live cattle trade with Indonesia, and a live cattle deal with China all point to a profitable future for the Australian red meat industry.

 

Indeed, Indonesia’s Santori and China’s Fucheng Group have acquired Australian cattle stations, while Andrew Forrest, Gina Rinehart, Kerry Stokes, Romeo Roxas, and Xingfa Ma have all bought pastoral agricultural properties in the country as a means of leveraging Asia’s growing demand for high quality, Australian protein.