Cubbie Station a 93,000ha business spread across properties on the Murray-Darling Basin in Southwest Queensland, is now 80% owned by Shandong RuYi Scientific & Technological Group Co Ltd, comprising Chinese and Japanese investors.
The remaining shares will be owned by Lempriere Pty Ltd, an Australian family-owned group with a long history in wool trading and in managing agricultural properties. A wholly-owned subsidiary of Lempriere will manage the operation including marketing and selling its cotton production.
Cubbie Station went into voluntary receivership in 2009, reportedly owing A$320million.
Receivers McGrathNicol announced this month that a sale agreement had been signed. It says the consortium, RuYi and Lempriere “have agreed to enforceable undertakings with the Australian Federal Treasurer in relation to the transaction.”
The deal provides certainty for Cubbie Group and its employees, says deed administrator John Cronin.
The sale reignited the foreign ownership debate in Australian politics. It also split opposition partners Liberals and Nationals, who mostly represent rural constituents.
National leader Warren Truss questioned why it is in the national interest for control of Australia’s most valuable farm, along with its massive water rights, to be ceded to overseas owners.
“Under current rules it is very difficult for foreigners to buy a suburban home in Australia, but it seems the Treasurer has no issue with the biggest irrigation farm in the country being bought by overseas interests.
“While capital flow is welcomed, the Treasurer must explain how a purchase of this scale will not compromise market competition or pricing for Australian cotton, with Cubbie representing about 10% of our national cotton crop.” But Opposition spokesman on foreign investment, Joe Hockey publicly rebuked Nationals for speaking out against the sale.
“They do not speak for the Coalition. They do not even speak for the National Party or the Liberal Party. I speak on the foreign investment policy of the coalition. We support the Foreign Investment Review Board.”
Treasurer Wayne Swan approved the sale on August 31 subject to a number of important undertakings obtained from the consortium in relation to employment, ownership, board composition, management and water use.
