April 2004 decisionsOne application refused – to buy land on Waiheke Island Pernod Ricard buys Framingham Wines Neil Construction buys Auckland Crown land for commercial office development Nikken Foods buys more land near Oamaru
One application refused – to buy land on Waiheke IslandSerge Marquie and Sally Anne Wilkinson of France have been refused approval to acquire 7.2 hectares at Cowes Bay Road, Waiheke Island, Auckland for $1,293,750 from Macula Holdings Limited of Aotearoa. The OIC’s rationale says:
The Applicants proposed to acquire the subject property to establish a high quality international art centre that was to consist of a commercial art space to provide a facility to display art for both local and international artists to sell their works, and a public gallery. It was proposed to establish an olive grove on one hectare of the property to produce olive oil. The Applicants proposed to construct a residence on the property.
The proposal does not meet the lifestyle policy which requires an applicant: (a) to be taking up New Zealand permanent residency with 12 months of the date of approval; or (b) to be undertaking significant developments on the property and converting it from a lifestyle property into a viable investment property; or (c) to have significant investments in New Zealand. [Decision number 200410041.] Pernod Ricard buys Framingham WinesPernod Ricard Australia Pty Limited, owned by Pernod Ricard SA of France, has approval to acquire Framingham Wine Company Limited for $6,670,000 (an amount which was initially suppressed but released on appeal in July 2004), from its shareholders: · Andreas E Rihs of Switzerland (40%), · Gordon Frederick Abernethy of Aotearoa (20%), · PKJ Brooke-Taylor of Aotearoa (12.5%), · Rex Brooke-Taylor of Aotearoa (12.5%), · Peter Stubbing of Aotearoa (10%), · Michelle Mangos of Aotearoa (5%).
The purchase includes 10.7 hectares of freehold land and 5.94 hectares of leasehold at Condor’s Bend Road, Renwick, Marlborough.
According to the OIC,
Framingham Wine Company Limited is an established premium New Zealand wine company which sources grapes from owned and leased vineyards and from contract growers to operate its winery in the Marlborough region.
The principal activity of the Applicant is the production, sale and distribution of wines in the Australian and international markets and the distribution of spirits in the Australian and New Zealand markets. The Applicant is a subsidiary of a global wines and spirits company. The aim of the Pernod Ricard group is to expand its wines and spirits portfolio either through the acquisition of established global brands or the acquisition of local brands. Pernod Ricard does not currently own any New Zealand brands. The proposed acquisition is likely to enable Pernod Ricard the ability to offer a complete “new world” wine portfolio to its customers.
The purchase, which was agreed by the two parties in February 2004, is through Pernod Ricard’s Australian subsidiary Orlando Wyndham, Australia’s largest wine and spirits company, whose wine brands include Jacob’s Creek and Wyndham Estate. It is Orlando Wyndham’s first overseas purchase, though it already has sales offices in Aotearoa.
Framingham was established in 1991, producing Framingham and Tylers Stream wines in Marlborough. It has its own winery and sales facility near Renwick in the Wairau Valley. It uses grapes from both its own vineyards and from contract growers. Annual production is around 270,000 litres. Framingham’s chairman, Rex Brooke-Taylor, will continue as a grape grower and director of the company. (Euronext Paris, “Pernod Ricard – Framingham Winery Sale Sealed”, 6/4/04; and Pernod Ricard press release, “Pernod Ricard: Accord sur l’acquisition de Framingham Winery”, 6/4/04.) [Decision number 200410039.]
In a second decision, without appearing to acknowledge the above change in ownership the OIC has given approval for Framingham Wine Company Limited, under its previous ownership, to acquire 5.9 hectares of leasehold at Condor’s Bend Road, Renwick, Marlborough for $352,375 from Rex Brooke-Taylor (Framingham’s chairman) and Paula Brooke-Taylor of Aotearoa. The OIC says:
The Applicant entered into a lease of the subject property for the purpose of continuing the development of the vineyard on the property. This application is a continuation of the development programme proposal consented to by the Commission in decision numbers 982048 and 200020026, which includes the better control in the processing of Framingham’s product and to ensure the continuity of supply of grapes which are critical for the wine processing operations. Furthermore, the development of the winery will enable Framingham to grow to become a genuine international boutique winery, thus providing the creation of new employment opportunities, new export earnings and increased domestic revenue. [Decision number 200410042.]
Andreas E. Rihs was originally given approval to buy his 40% shareholding in Framingham in August 1998. At the same time the company gained approval to buy almost three hectares of land at Conders Bend Road for $210,000 from the Brooke-Taylors, the original owners of Framingham Wine Company, who became 40% shareholders in the company (the shareholding has changed further since then). The land was to be used to develop a winery. Previously Framingham labelled wine had been made through a third-party wine processing facility.
In August 2000, the OIC gave approval for Framingham to acquire eight hectares of land at Condors Bend Road for $862,080 for the development of a winery. The land was again purchased from the Brooke-Taylors. In May 2000, Rex Brooke-Taylor sold land for vineyards in two very similar OIC decisions. In the first, Rihs received approval to acquire up to 80% of Kaituna Vineyards Ltd, which owns 170 hectares of land at Kaituna, Blenheim, Marlborough, for an amount “to be advised”. The land was currently bare and the company intended to develop it as a vineyard to market wine under its own label. Rihs would “become involved in the management of the company and the development of the vineyard”. In the second, J. Larter of the U.K. received approval to acquire up to 50% of Northbank Wine Estates Ltd, which owns eight hectares, also at Kaituna, for $154,688. Neil Construction buys Auckland Crown land for commercial office developmentNeil Construction Limited, owned by the Tiong Family of Malaysia, has approval to acquire 0.42 hectares at 5-7 Aviemore Drive, Highland Park, Auckland for $1,406,250 from The Crown of New Zealand. According to the OIC,
The Applicant proposes to acquire the subject property to add it to its portfolio of commercial subdivisional land in the Auckland region. The property was acquired by The Crown from the Applicant pursuant to the Public Works Act 1981 for Police Station purposes. The subject property is now surplus to Crown’s requirements. As required under the Public Works Act 1981, The Crown has offered it back to the Applicant.
The land has a commercial zoning upon which the Applicant proposes to develop a commercial office park. The proposed development is a permitted activity within the zone. Planning and design of the project will commence immediately with the total development likely to be completed in 12 to 18 months time.
Most of Neil Construction’s frequent purchases to date have been for residential subdivision. The last one was in November 2003, when it received approval to acquire land at Rising Way Road, Albany, Auckland. See our commentary for that month for further details. [Decision number 200410043.] Land for forestry· Heywood Forest Partnership, owned by Lawrence Heck and Kathleen Heck of the U.S.A. (10%), Joseph Dunbar of the U.S.A. (8.63%), Stewart R Davey of the U.S.A. (4.13%), Stephen Schley and Lizabeth Schley of the U.S.A. (4%), Jon G Eichstaedt of the U.S.A. (2%), Richard M Morgan of Australia (5.11%), Yukichi Konohira and Toshiko Konohira of Japan (2%), and 64.13% in Aotearoa, has approval to acquire 374 hectares at Wharekopae Road, Gisborne for $805,849 from Michael Patrick Eivers and Phillida Anne Eivers of Aotearoa. Says the OIC: “The overseas participants in the Heywood Forest Partnership are investing with New Zealand investors in an intensively managed plantation forestry operation. While New Zealand has the fastest growing plantation forests in the world, there is a limited amount of investment capital available in New Zealand to expand those plantation forests. Roger Dickie (NZ) Limited, the promoter of the Heywood Forest Partnership, promoted the partnership widely to New Zealanders by way of the offer of Participatory Securities in the Partnership under a Registered prospectus and Investment Statement dated 2 June 2000. However in order for the Participatory Securities to be fully subscribed, the participation of overseas investors was an important part of the project. The forestry operation is managed by Forest Management New Zealand Limited a New Zealand company which is owned by Roger Dickie, with over 25,000 hectares of forest under its management.” [Decision number 200410044.] Nikken Foods buys more land near OamaruNikken Seil Co Ltd (formerly known as Nikken Foods Co Ltd), owned 74% by Hirotomo Ochi of Japan and 26% in minority shareholdings in Japan, has approval to acquire a further block of land near Oamaru, Otago, this time 149 hectares at Taipo Road, Oamaru for $2,306,250 from Taipo Downs Limited, owned by Allan Bruce Robins and Marie Elizabeth Robins of Aotearoa.
The OIC reports:
The Applicant was founded in 1964 and has subsequently become a pioneer in the development, manufacture and marketing of natural food flavourings. The Applicant’s aim is to supply food products that are beneficial to health and it manufactures more than 1,000 natural flavourings. Within the Applicant’s group structure there is a high importance on research and development including the Institute for the Control of Ageing, the Research Institute for Future in Foods and the Health and Fitness Institute.
The Applicant’s chairman has discovered North Otago the perfect setting for the international expansion of the research and development programme. In 2000, the Applicant acquired a 29.5328 hectare property near Oamaru known as Teschemakers (Refer A200010070/D200010084) to establish an international college for post-graduate international and New Zealand students of health science. The Applicant has also obtained consent to acquire adjoining farm land for the purposes of progressing its work in sustainable organic and healthy farming (Refer A200210113/D200210130 13.2876 hectares and A200210142/D200210129 21.7405 hectares).
The Applicant received approval to enter into a purchasing programme to acquire 250 hectares in the North Otago region, within a 5 kilometre radius of the Teschemakers college (Refer A200220006). It is proposed that the land to be acquired will be utilised for experimental/research purposes, as buffer land and for commercial production. The Applicant envisages that the international college will encourage and promote post-graduate study, research and development in the area of organics and healthy-living. This will provide demand for workable tracts of land with boundaries free of contamination from insecticides, herbicides and genetically engineered plants and crops.
This application is outside the approved purchasing programme. The previous applications under the purchasing programme have totalled 114.2174 hectares.
The Applicant had advised that the construction of the Teschemakers College is underway with a view to opening for courses in late 2003. This has now been deferred to late 2005, following a fire in August 2003. The subject property is likely to be used for experimental/research purposes once the college opens. In the interim the land owned by the Applicant will continue to be used for market gardening and be prepared for organic certification.
The company’s last such land purchase was in April 2003. See our commentary for that month for further details. [Decision number 200410045.] Other rural land sales· The Claire Donella and Richard John Family Trust of the U.K. has approval to acquire 14.0 hectares at 20 Thorps Quarry Road, Clevedon, South Auckland for $1,068,750 from Ian Albert Bailey and Leigh Mary Bailey of Aotearoa. According to the OIC, “The Applicants have applied for New Zealand permanent residency under the Business Investor category and propose to acquire a lifestyle property situated at Clevedon. The Applicants are proposing to relocate to New Zealand and intend to reside on the property and utilise it for show jumping, training and other equine activities. The Applicants are demonstrating a commitment to New Zealand through applying for and taking up New Zealand permanent residency.” [Decision number 200410040.] · Adrian Reginald Matthews and Alison Margaret Anne Matthews of the U.K. have approval to acquire 6.2 hectares at 45 Chapel Street, Loburn, Canterbury for $202,500 from John Francis Fitzsimons and Marie Antoinette Bentley of Aotearoa. According to the OIC: “The Applicants have applied for New Zealand permanent residency under the Skilled Migrant category and propose to acquire a lifestyle property situated at Loburn. The Applicants intend to construct a dwelling and reside on the property. The property which has been subdivided from a larger block of land by the vendor has not been farmed as an economic operation but more as a lifestyle/hobby farm. The Applicants are demonstrating their commitment to New Zealand through applying for and taking up New Zealand permanent residency.” [Decision number 200410046.] Summary statisticsAll investments This was a very quiet month. Only six applications applied to this month, of which one was refused. An additional two approvals were retrospective approvals, giving investors permission to flout the law (and the OIC does not divulge which decisions these were). The value of investment approved in the year to April 2004 is considerably lower than for the previous April year, both in net value (i.e. disregarding sales from one overseas investor to another, and discounting part New Zealand ownership of the assets) and gross value. This is largely because while this year April is a quiet month, in April 2003, almost $3 billion gross investment was approved. As usual, by far the greatest part of the value of the approvals is for sale from one overseas investor to another.
*In addition there were two retrospective approvals granted during the month. These involved a gross consideration of $1,098,307 and a net investment of $408,516
Investment involving land Gross sales of land approved by the OIC during the years to April have increased in area, though net sales are reported as having fallen so far as to be negative. This reflects the OIC’s treatment of “net” transfers – that for example a sale from a 100% overseas owned company to a 50% owned company decreases overseas ownership of land by 50% of the land area involved. That may be true of investment income from the property, but 50% ownership can mean 100% control of the land (and indeed the OIC’s governing legislation assumes 25% ownership means control; Statistics New Zealand assumes 10% ownership means control) so these net figures are not to be taken seriously. Refusals (above) have risen slightly in number, area and value, but are still a tiny proportion of the total.
*In addition there was one retrospective approval involving freehold land. This involved a gross land area of 337 ha and a net land area of 121 ha.
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Compiled by:
Campaign Against Foreign Control of Aotearoa, P. O. Box 2258 Christchurch. |
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