Jiajiayue Group's $4.5 million investment in New Zealand listed Cooks Global Foods is conditional upon approval from New Zealand’s Overseas Investment Commission for the acquisition of a 600 hectare sheep and beef farm in Port Waikato.
Jiaiayue Group, a Chinese supermarket chain that is also involved with agricultural processing, wholesaling, retailing, logistics, and distribution activities, has made a formal commitment of $4.5 million in conjunction with a second commitment of an additional $4.5 million made by a group of strategic investors that is led by executive chairman Keith Jackson and that includes existing Cooks shareholder Yunnan Metropolitan Construction and Investment Co.
A special meeting will be held before the end of October for shareholders to vote on the deal which involves selling 70.3 million shares at 12.8 cents per share to Juajuayue Group and Jackson’s group of investors. Together, the two would jointly assume the 40% stake held in Cooks by Esquires New Zealand founders Stuart and Lewis Deeks who are exiting the company.
Upon completion of the deal, Jiajiayue would hold a 25% stake in Cooks, and the Jackson consortium would hold a 35% stake. However, Jiajiayue Group has made their participation in the deal conditional upon approval from New Zealand’s government for its acquisition of a 600 hectare beef and sheep farm in Port Waikato. Although the two deals are not linked, Jiajiayue is considering the approval part of its entire New Zealand investment.
The refusal earlier this month by New Zealand’s OIO to grant approval for Chinese-owned Pure 100 to acquire the Lochinver Station, based on the belief that the deal would not provide a large enough benefit to the country, has received widespread media coverage in China and has created unease among offshore investors regarding New Zealand’s foreign investment guidelines and approval system.
If Jiajiayue Group moves forward with its investment in Cooks, it will be in a position to nominate one director on the board, as will the Jackson consortium.