BusinessDesk: Fay poll shows public wants Govt to stop Crafar sale to Chinese buyer

BusinessDesk: Fay poll shows public wants Govt to stop Crafar sale to Chinese buyer

By Pattrick Smellie

Polling for the Michael Fay-led consortium trying to buy the Crafar dairy farms shows an “overwhelming desire for the government to stop in and stop the sale” to the would-be Chinese buyer, Pengxin International.

However, the same poll shows two-thirds support for joint venture investments involving a combination of Chinese and New Zealand interests.

The poll, conducted by UMR Research, comes as Labour’s Associate Finance spokesman David Parker accuses the Overseas Investment Office of buckling to political pressure not to announce a decision on the Crafar farm sale before the Nov. 26 election.

Parker alleges “political motivations behind no decision having been taken in the past six months on the latest foreign application to buy the Crafar farms.”

“On the face of it, there’s no reason the Overseas Investment Office could not have made a decision. So why hasn’t it?” he said.

The Pengxin application follows the rejection of a bid by another Chinese bidder, Natural Dairy.

A well-established and reputable investor in both China and globally, Pengxin is seen by the investment community and by the Chinese government as a fundamental test of the New Zealand-China trade relationship.

Senior investment banking figures have warned that failure to approve the Pengxin bid could see a withdrawal of Chinese interest in New Zealand investments, and a cooling in Beijing to New Zealand’s aspirations in China, particularly Fonterra’s plans for dairy industry development.

The OIO and Prime Minister John Key have both described the Pengxin bid as “complex”, but have given no further detail as to why the application has run so far beyond the OIO’s target timeframe for approvals.

“The only conclusion I can come to is that National doesn’t want a decision to be made until after the election, because the government is already copping so much flak for its intention to sell our power companies,” said Parker.

The UMR poll also finds the public would “prefer the farms are sold to a New Zealand syndicate even if at a lower price”. The Fay consortium, which includes some iwi and private investors, is offering $170 million for the Crafar farms, in receivership, against Pengxin’s offer in excess of $200 million.

The receivers, KordaMentha, have accepted the Pengxin bid, conditional on OIO approval and have said they will not entertain alternatives in the interim.

The UMR poll tested the views of a relatively small sample of 500 people has a margin of error “at 95 percent confidence level” of 4.4 percent, but its results are emphatic.

Some 82 percent saw foreign ownership of agricultural land as “a bad thing”, while just 10 percent thought it was “a good thing”, with almost identical numbers opposing farmland sales to foreign investors.

Most emphatically opposed is Chinese investment, with 81 percent opposing such sales, dipping to around three-quarters of those polled opposing sales to Singaporean, Japanese, German and American investors, while 67 percent opposed sales to British investors, and 54 percent opposed sales to Australians.

Australia gained by far the largest positive support as a buyer of New Zealand farmland, at 33 percent, followed by Britain at 23 percent.

Opposition to selling the Crafar farms was constant across age groups, but stronger among women (88 percent opposition) than men (79 percent), and one in five National Party voters oppose the sale.

Told that the New Zealand consortium’s bid was $30 million lower than the Chinese offer, 74 percent still thought the local offer should be accepted.

The poll did not seek a view on the involvement of Sir Michael Fay, whose involvement privatisations and the “winebox” tax avoidance inquiry in the 1990s largely undid the heroic reputation he gained as the backer of New Zealand’s first bids to win The America’s Cup.

He and business partner David Richwhite relocated to Switzerland in the late 1990s and have had a low profile in New Zealand until Sir Michael’s emergence as a “white knight” on the Crafar farms issue.

Some 78 percent agreed with the proposition that “not allowing foreigners buying the Crafar farms is a principled defence of New Zealand rights and sovereignty”, while 15 percent said it was “bowing to xenophobic and populist hysteria.”

Allowing a sale to Pengxin would be “bowing to Chinese economic power” in the view of just over half those polled.

However, when asked about investments involving Chinese companies in partnership with New Zealand companies, there was 66 percent support, and 56 percent support for the notion of shares in such Chinese companies being listed on the NZX for trading by New Zealanders.


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The leadership of this country steadfastly refuses to invest in anything other than agriculture, and yet it also appears determined to divest itself of farmland.

What does that leave us with?


"Maaaate, you can't lose with houses", etc etc...

Have to laugh, Michael Fay is STILL trying to milk NZ for all it's worth......

He should hire Peter Montgomery to scream over and over that "IT'LL PUT NEW ZEALAND ON THE MAP!" until we all wish that they were both dead.

"...until we all wish that they were both dead."

You mean the way we have since around 1987 or so?

I hope the farm s sell to overseas interests rather than line the pockets of the dirty ,filthy merchant banker.his track record is shite

The receivers to Crafarm missed an opportunity to float the farms as one company on the NZX . A pity that NZX CEO Mark Weldon didn't put this idea to them .....

.... an alternative real estate  investment for Kiwis , to buy a stake in their own dairy industry .

We really lack imagination at times , don't we ........

Gummy, the word is that the receivers have done a poor job in running these farms. Lack of fertiliser etc over the last 2/3 years. Production is down and so there would be some capital costs required to get these farms up to speed. As you say, the opportunity was there at the beginning.

ng - Fay would only be taking up 2 of the farms the biggest buyers would be the Maori Trusts.

D'yer reckon Bernard should head back in there , and pick another fight with the foreman ?

....... watch out Alex , Bernard knows how to swerve , weave & duck  , it was your predecessor Bryan Sponde who got snotted last time "round !

Nah, no one wants to know how badly the receivers are handling the farms Gummy. Last I heard there was a group of 5 'consultants' running the farms, and we all no there is no such thing as collective responsibility or individual responsibility when a committee runs things - it always falls to the silent person - 'not me!'

Bernard might be handed a trespass notice from the receivers if he tried. ;-)

...... best that the Hickey brigade  don't re-visit the Crafars then ....  that'll save Sam Webb from hurting his fist again ......

Farmers don't want to share their industry with non farmers. It's why they repeatedly vote down any attempt to make shares available to the public.

The receivers to Crafarm are under no obligation to other farmers'  interests or opinions .

They could easily securitize the farms into one bundle , set up a board of directors , and do an IPO .

....... that'd be a good dividend payer for Mom & Pop kiwi investors , and another investment option for KiwiSaver funds . .... . a sizeable chunk of this Crafarm  investment would remain in NZ ownership & control ........

Win / Win !

Why should they Marlarkey?

You had a chance to invest in Synlait and thumbed your nose at it. NZ Dairy went up for sale - didn't see you jumping in and buying it. 

Many non farmers are invested in farming - it's called corporate/equity farming. Minimum is usually $250,000.

I knash me Gummy gums , by golly I do , at all the opportunities lost ...... Synlait is a brilliant factory , down at Dunsandel ( excellent pies in town , too ! ) ...... they're now turning over $NZ 400 million in annual revenue .

..... this is a growing business , unlike TradeMe , Synlait could have earnt a decent capital gain and a dividend stream for Mom & Pop kiwi investors ......

You are right , CO , we whinge about overseas ownership of " our " assets , but we aren't willing to back them ourselves .......

Synlait was massively overpriced Gummy - Don't think you would have paid the multiples that they wanted. Plus Penno is an arrogant twat.

Chinese definitely overpaid!! They paid strategic prices for it, not on pure investment logic.

Oh and just wait till the new Fonterra factory starts down the road. Fonterra will predator price away any profit from Synlait.

Last listed dairy play, I remember was Tasman Agri or Dairy Brands which was an average investment at best investment. Unless you where Paterson who sold in at a super high valuation or Alan Hubbard/Pye who bought the farms at a 10 year farm low.

The recievers should accept the best price end of story, does not matter if its chinese, so long as the money they pay is green!!


True , but compared to TradeMe , Synlait continues to offer the prospect of growth . TradeMe is being sold at the growth multiple , even though it has saturated it's only market .

.... I do recall Tasman Ag as a listed entity . Indeed they were an average performer . But from a diversification point of view , there's no harm in having a few steady stocks included in the portfolio ...  . TradeMe would fit the bill , if Fairfax weren't so greedy with the pricing .

Michael Fay's consortium could always offer a higher price rather than commissioning a meaningless poll.

Could someone please remind me, is that the same Fay that managed to grab a whole pile of cash out of tax payers back in the late 80s (NZ Rails)?  And then conveniently set up shop in Europe.. And then got a knighthood out of us as well.

Now if we believe that then we are a bunch of fools.

Yes indeedy , it is one and the same Fay , who became a rich white knight to the plight of the Kiwi battlers on Struggle Street !

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