Rinehart, Chinese firm make joint bid for S Kidman

Gina Rinehart's company Hancock would own 67% of Kidman in the deal, with Chinese real estate company Shanghai CRED taking 33%.

Australia’s richest person, Gina Rinehart, and Chinese real estate firm Shanghai CRED have made a A$365 million ($277.14 million; €248.15 million) joint bid to buy S Kidman’s cattle portfolio.

The joint venture’s 33 percent foreign ownership would be below the current 33.9 percent foreign interest in Kidman.

Mining heiress Gina Rinehart’s mineral explorations company Hancock would own 67 percent of Kidman interests through joint venture Australian Outback Beef. Hancock has been steadily expanding its interests in Australian beef, and bought two cattle stations in the Northern Territory from KKR-baked Indonesian importers Japfa in July.

At the end of April, Australian Treasurer Scott Morrison turned down a Chinese-led bid for the S Kidman cattle business for the second time. Chinese dairy giant Shanghai Pengxin’s Australian interest, Dakang Australia, had agreed to buy S Kidman for A$370.7 million in consortium with Australian Rural Capital and Shanghai CRED.

Finance minister Mathias Cormann has indicated his support for the deal, saying that he was pleased Kidman’s assets would be majority owned by Australian interests.

Before this new deal can go through, the sale of the Anna Creek property, which covers a weapons testing range, to Australian investor, must be completed. A nearby 8,877 sq km property, the Peake, must also be sold.

“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,” said Hancock chief executive officer Garry Korte.

Local reports suggest that Rinehart is looking to build up one of Australia’s largest dairies to supply milk for infant formula, a key Chinese market. Shanghai CRED is also building up a cattle portfolio, buying the Yakka Munga cattle station from Buru Energy and snapping up Mount Elizabeth Station in the Kimberley region.