Asian companies are circling WA's biggest dairy enterprise as overseas demand for agricultural assets continues to grow.
Lactanz Dairies, near Scott River in the South West, is on the market for about $40 million, including livestock, with vendor Elders Real Estate expecting strong interest from Malaysian, Singaporean and Chinese buyers. Lactanz, made up of four farms, four dairies and about 4000 milking cows over 2344ha, is the biggest single producer of milk in WA and a major supplier to Brownes.
The company produced 1,293,500kg of milk solids in 2011-12.
Chinese beverage billionaire Zong Quinghou visited Busselton two months ago as he considered a $200 million investment in a milk processing plant by his Hangzhou Wahaha Group.
Elders rural properties specialist Noel Jones said HWG was one of the companies "on the radar" for the Lactanz sale.
“They were looking to source a piece of land near Busselton, with power, gas for a milk processing plant — not a dairy proper,” Mr Jones said. “But they have shown a bit of interest in dairies.”
A local investor with Singaporean and Malaysian backing had previously expressed interest in buying Lactanz, which is owned by New Zealand-based company Rosmerta Pty Ltd.
Mr Jones said it was not a forced sale. The major shareholders in Rosmerta had simply reached a stage in life where they wanted to bow out after a successful stint in WA.The dairy is run by share farmers and the property, infrastructure and livestock owned by Rosmerta.
Brownes has a five-year contract to take milk from Lactanz and an option to buy about 3000 of the milking cows but is happy for the cows to be sold with the property, according to Elders.
The interest in Lactanz from Asian investors comes after a report in WestBusiness yesterday revealed the sale of prime agricultural land at Lake Varley to a Chinese company.Earlier this year, a Chinese company agreed to buy Narrikup-based Ravenhill Dairy, another of WA’s biggest milk producers.