When it comes to the long, drawn-out prospective sale of Australia’s S. Kidman cattle empire, it feels like a scenario of ‘the music goes on but the song remains the same’. However, the tide may be turning in light of the newest bid for the largest landholder in Australia.

In the latest development, Gina Rinehart, Australia’s richest woman who gained the bulk of her wealth in the country’s mining boom, has partnered with China’s Shanghai CRED to form the joint venture, Australian Outback Beef, through which the two have made a A$365 million (US$276.8 million) bid for the S. Kidman cattle conglomerate.

Under the terms of the agreement between the two partners, Gina Rinehart’s Hancock Prospecting will own 67 percent of S. Kidman, with Shanghai CRED owning the remaining 33 percent. This will be a repeat bid from Shanghai CRED who in April of this year headed a consortium with Hunan Dakang Pasture Farming and a 20 percent Australian interest that made a bid of A$371 million (US$281.3 million). The bid was subsequently rejected by Australian Treasurer, Scott Morrison, who claimed the deal would not be in the country’s best interest. It is hoped, however, that this offer, with a significantly lower foreign ownership stake will be more readily accepted by the Australian government.

The iconic nature and national significance of S. Kidman has drawn out its sale process after repeated rejections of offers from Chinese bidders or partnerships with majority Chinese partners amid political and populist pushback against foreign control of Australia’s agricultural holdings.

Established in 1899 by Sidney Kidman, the company has grown to run 185,000 head of cattle on 101,000 square kilometers of land, or 1.3 percent of the land area of the country, stretching across Queensland, South Australia, Western Australia, and the Northern Territory. Equal in size to the country of South Korea, S. Kidman is the largest private agricultural landholder in Australia including 19 properties, ten cattle stations, a bull breeding stud farm and a feedlot.

Ms. Rinehart’s move for S. Kidman is the latest in her campaign to build an Australian cattle empire as her focus shifts away from mining. In July it was announced that Hancock Prospecting acquired the Inverway and Riveren cattle stations in the Northern Territory totaling 550,000 hectares and a herd of 40,000 head of cattle from Indonesia’s Japfa Santori. Then, a week later it was announced that the group acquired Phoenix Park – a registered live cattle export yard and depot licensed for 20,000 head, that also includes a large-scale fodder growing operation.

The Building of a New Empire

The acquisition of such infrastructure has been considered an indication of Rinehart’s goal of building an integrated supply chain, as these acquisitions combined with her existing portfolio, including the Liveringa, Nerrima, and Fossil Downs stations, bring her entire beef herd to nearly 100,000 head of cattle.

“The quality of the Kidman herd and channel country properties complement Hancock’s existing northern cattle properties, and align well with Mrs. Rinehart’s plans to build a diversified cattle holding in Australia, taking advantage of integration opportunities,” Hancock chief executive Garry Korte told ABC.

This new offer will still need to acquire regulatory approval in Australia, however, given the ownership structure of the bidding partnership, this offer may signal the end of a sale process that has stretched on for 18 months.

“I’m always enthusiastic when … a majority Australian company is buying Australian land,” Agriculture Minister Barnaby Joyce told Australian Broadcasting Corporation.

“Most Australians prefer it if a large Australian asset is majority owned by Australians as opposed to majority owned by foreigners.”

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Lynda Kiernan