S. Kidman & Co sale back on with DomaCom and Lloyds to launch $370m bid

The highly politicised sale process for Australia’s largest landholder S. Kidman & Co has been officially reopened and crowdfunder DomaCom has joined forces with Lloyds Business Brokers to launch a fresh $370 million bid.

DomaCom and Lloyds have entered discussions with Ernst and Young, which is handling the sale process for the Kidman shareholders, and has been given access to the sale documents.

Their plan is to buy S. Kidman & Co in a matching bid to the failed bid from Chinese-backed consortium Dakang Australia – which was rebuffed by Treasurer Scott Morrison last month – and then separate the purchase of the land and the operating business.
DomaCom chief executive Arthur Naoumidis said the fresh offer from DomaCom and Lloyds would see the land valued at $210 million and the operating businesses at $160 million.

“At a price of $210 million, it would give investors a gross rental yield of 3.9 per cent in addition to capital growth, low volatility and the opportunity to keep an Australian agricultural icon in local hands,” Mr Naoumidis said.

Last month Treasurer Scott Morrison said he had reached a “preliminary finding” that the national interest required him to withhold approval of the bid by Dakang Australia for the pastoral business, which spreads across 11 million hectares of land.

Lloyds’ Victoria director Chris Butchers said he would draw upon a data base of private investors to fund his side of the bid that would buy the shares in the operating business and lease the land from DomaCom.

“On the business side we expect to see significant interest from equity funds and professional investors keen to capitalise on the growing worldwide demand for Australian beef,” Mr Butchers said.

EY’s Don Manifold, who is handling the sale process, confirmed the move.
“We are back to square one – we are looking at all options,” Mr Manifold said. “With this round three we will be months away from any result.” Mr Manifold welcomed new bids.

Mr Naoumidis said being granted access to EY’s sale process was an important development because it meant he could now engage with potential investors “armed with all the facts and figures about Kidman and its operating businesses”.

The property crowdfunding group had hoped to buy S. Kidman & Co, and list as a public company. However in February, when the Kidman deal was tied up with Dakang.

DomaCom said it would use its pledged funds to buy other farms across Australia.

Other groups looking to buy S. Kidman & Co did the same. Rifa Salutary, the Australian arm of China’s Zhejiang Rifa Holding Group, which looked at S. Kidman & Co, purchased close to $60 million worth of farms in NSW.
Indicative bids for the new S. Kidman & Co sale are due on May 26.
Read more: http://www.afr.com/real-estate/s-kidman–co-sale-back-on-with-domacom-and-lloyds-to-launch-370m-bid-20160519-goz931#ixzz49SVKdGsi

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