Rinehart team gets Kidman green light
Federal Treasurer Scott Morrison has approved the sale of the majority of S. Kidman and Company’s outback pastoral business to the joint venture led by mining billionaire Gina Rinehart.
Mrs Rinehart’s Australian Outback Beef is promising to increase the size of the Kidman herd and spend up to $19 million on capital improvements to increase efficiency and carrying capacity of the 19-property enterprise.
The sale plan involves the Kidman group’s largest largest station “Anna Creek” and its outstation “The Peake” being sold to the Williams family which has properties adjoining the 23,300 square kilometre “Anna Creek”.
The remaining two thirds of the Kidman and Co business will be acquired by the Australian Outback Beef partnership between Mrs Rinehart’s Hancock Prospecting’s beef subsidiary and the long-time Chinese bidder Shanghai CRED Real Estate Stock Co.
Kidman and Co management has confirmed 99 per cent of shareholders in the company founded 117 years ago by cattle baron Sir Sidney Kidman have accepted the offer.
Kidman is Australia's largest private land owner with an estate covering 1.3 per cent of Australia's total land area, or 2.5pc of the country’s agricultural land, spread over 101,000 square kilometres in South Australia, Western Australia, Northern Territory, and Queensland.
After almost 20 months of intense political and public scrutiny and controversy, including two unsuccessful sale attempts to Chinese majority-owned groups, Kidman and Co said the sale was now proceeding to its conclusion.
Hancock Beef holds a 67pc stake in Australian Outback Beef (AOB) and will control the board, and day-to-day operation of the business.
AOB has also committed to increasing the Kidman herd size by 20,000 head in the next 18 months, investing up to $19m in improvements to boost efficiency and carrying capacity and the the creation of 35 new full-time permanent jobs by June 2018.
AOB will also be employing extra contractors and short terms specialists.
Kidman and Co managing director, Greg Campbell, said staff and management were “excited about entering into a new and transformational phase of this historic business”.
Mr Morrison noted the increased employment will be met by “engaging local populations as far as possible, including indigenous employees”.
“Kidman will remain majority Australian-owned under this proposal, and remain an Australian incorporated company headquartered in South Australia,” he said.
“Existing environmental and other commitments will continue to be honoured.”
In a statement on the sale’s approval the Treasurer said any future changes in ownership, including any increase in interest by Shanghai CRED, would require subsequent approval from the Foreign Investment Review Board and his office.
The latest sale plans signed off by Mr Morrison represented a significant increase in overall Australian ownership of the Kidman land area from 66.1pc to 74.7pc.
“Consistent with the recommendation from the Foreign Investment Review Board (FIRB), I have decided that the acquisition of Kidman as proposed would not be contrary to the national interest and will be permitted to proceed as proposed,” he said.
“The proposal will be subject to standard taxation conditions.
“The sale process has been extensive and heavily scrutinised, and afforded ample opportunity for Australian bidders to participate.
“Over the process as a whole, Kidman has spoken with over 600 potential bidders, and over 30 bids were received.”
S. Kidman and Co’s Mr Campbell said he spoke for many Kidman employees in saying he was pleased Hancock, a
highly respected Australian company, led the joint venture that had received key approvals to acquire the business.
“Mrs Rinehart is a prominent Australian and we appreciate her desires to further invest and grow the business,” he said.
“We are excited for the future and look forward to working with her to take the business to the next stage of its development.
“We also welcome the AOB commitment to keep the Kidman head office in Adelaide, and ensuring the jobs of Kidman’s hard working employees are safe.”