February 1998 decisions

February 1998 decisions

Hoyts buys out Endeavour

Hoyts Corporation Holdings (NZ) Ltd, a subsidiary of Hoyts Cinemas Ltd of Australia, has approval to buy out what was originally one of its most threatening competitors, Endeavour Multiplex Ltd. After an initial stand-off, however the two had formed a cosy joint venture:

“The parties to the transaction currently have a 50/50 partnership in the management/operation of the Hoyts Cinema Complexes throughout New Zealand. It is stated to date the expertise in the operation, development and growth of the partnership has substantially been provided by Hoyts. Hoyts Cinemas owns or operates over 130 cinema complexes in Australia, New Zealand and the US. Furthermore, it is stated the owners of Endeavour have now decided that they wish divest their 50% interest in order to pursue other activities.”

The price was $39,200,000, although news media reports indicated the price would be paid in Hoyts shares, issued at a 5% discount to the traded price (Press, 18/2/98, “Hoyts purchase”, p.33).

We recorded the beginning of this love-thy-competitor becomes eat-thy-lover process in the October 1992 decisions:

“The big Australian cinema chain, Hoyts, is merging its Aotearoa multiplex cinema operations with an Auckland company, Endeavour Multiplex Ltd. This neutralises the competition that Endeavour had been increasingly offering Hoyts. Hoyts own the Amalgamated cinema chain; their main competition until now has been the Pacer Kerridge (formerly Kerridge Odeon) chain, but this is now in trouble, having been placed in receivership due to the excesses of its owners. The two chains control about 90 percent of the cinema market (Press, 31 December, 1992) and Hoyts was turned down on competition grounds by the Commerce Commission when it tried to buy the Kerridge chain. Multiplex cinemas (multiple cinemas in one complex) were threatening to destabilise this cosy market sharing arrangement. In Christchurch for example, several proposals were floated during 1992 for multiplex cinemas, including proposals from the Big Two. Only one could survive in the city. The one that finally got underway is one being built on the site of the former Railway Station by Endeavour. By taking over Endeavour, Hoyts now has its desired multiplex in Christchurch, and once again leaves no independent cinemas in the city. Endeavour Enterprises is headed by the producer of the “Footrot Flats” film, John Barnett, and owns a number of multiplexes throughout New Zealand (Press, 7 January, 1993). Alongside its aggressive market behaviour, Hoyts recently cut its workers’ wages in Auckland.”

By the time of this present decision, Barnett had left Endeavour and it was owned by “Neal Hutton Plowman, Geoffrey John Harley, Christopher Pell Liddell and Annette Joan Plowman as trustees of the Realm Trust” according to the OIC, although the Press attributed ownership to a “privately owned company” connected to Neal Plowman’s family, Endeavour Services Corporation. By now it has also been shown that Christchurch could support several multiplexes.

Hoyts described itself in recent job advertisement for a business manager for its six screen Octagon complex in Dunedin as

“a global cinema exhibitor with over 1,250 screens spread over 178 sites throughout Australia, New Zealand, U.S.A., Mexico and Chile with further expansion underway in the U.K., Austria and Argentina. Box office admissions exceed 40 million and the group employs in excess of 4,800 people.” (Press, 21/3/98, p.22.)

Hoyt’s main competitors are now Force Corporation (in 1995 12% owned by the Tiong family of Malaysia, but main shareholder chairman Peter Francis) and Village Entertainment Property Trust of Australia, which also operate a joint venture. Force sold its half share in four Auckland multiplexes, which it will lease back, to Village Entertainment in March 1998 for $18 million. The sale was in order to finance a huge new entertainment centre in Auckland. The $60 million centre, which includes 12 cinema screens and a 450-seat giant screen cinema, as well as other shops and entertainment, is also planned to be sold to Village Entertainment on completion. Force also owns 50% of the Rialto art-theatre chain, and is expanding through a joint venture in Argentina as well as owning cinemas in Fiji. (Press, 28/8/97, “Force in massive centre bid”, p.38; 18/10/97, “Force shareholders approve Aotea project”, p.30; 12/2/98, “Force lifts profit 16%”, p.21; 23/2/98, “Force sells theatres”, p.24.)

Benchmark (Howard Smith) of Australia buys largest safety manufacturer

Howard Smith Ltd of Australia, which operates in Aotearoa as Benchmark Building Supplies Ltd, has approval to acquire NZ Safety Ltd/Alsafe Group for a suppressed amount. “NZ Safety is the largest industrial safety manufacturer and distributor in New Zealand with a national branch network distributing major national and international safety brands as well as its own products.” The owners of NZ Safety were NZ Safety Holdings Ltd (56%), Safety Management Holdings Ltd (40%) and NZSL Superfund (4%), who “wish to sell in order to rationalise their investment, both in New Zealand and Australia”.

Orica (ICI Australia) sells pharmaceutical division to Zeneca, buys H.B. Fuller

Orica New Zealand Ltd, a subsidiary of ICI Australia Ltd (and recently renamed Orica from ICI New Zealand), has approval to sell its pharmaceutical division to Zeneca Pharmaceuticals New Zealand Ltd, a subsidiary of Zeneca Ltd which itself is a subsidiary of Zeneca Group Plc of the U.K. The price has been suppressed.

“It is stated the proposed acquisition forms part of a wider transaction, which involves the acquisition of Orica Australia’s assets by the Zeneca Group. It is stated that Orica is currently the exclusive distributor of Zeneca pharmaceuticals within New Zealand, which forms part of a previous arrangement following the demerger of Zeneca from the ICI Group back in 1993. Zeneca state the proposal will enable the company to distribute its own products within the New Zealand market place.”

Zeneca, on its World Wide Web site, describes itself as follows (http://www.zeneca.com/glance.htm):

“Zeneca is a leading international bioscience group active in three main areas of business: Pharmaceuticals, Agrochemicals and Specialties. We research, develop, manufacture and market products to improve human health, nutrition and quality of life around the world.

Our product range includes the world’s largest selling breast cancer treatment, the world’s leading intravenous anaesthetic, the world’s second largest selling agricultural herbicide and the UK’s leading meat-alternative brand. We are the world’s number two in sales of cancer treatments and market the most comprehensive range of hormonal cancer therapies in the industry. Our agrochemicals business is the world’s third largest.

Recent additions to our portfolio, which will build on the success of our established range, include three new cancer therapies, new treatments for asthma and migraine and a novel crop protection fungicide.

In a separate approach to supplying medicines which combat serious health problems, Zeneca also aims to provide a range of services which address total healthcare needs. In the US, our Stuart Disease Management Services helps to develop better quality, lower cost comprehensive care programmes for patients with cardiovascular disease and asthma. Also in the US, Zeneca owns Salick Health Care Inc., the leading US multi-site provider of cancer diagnosis and therapy services. …

Worldwide, we sell in over 100 countries, manufacture in 25 countries and employ over 30,000 people …

In 1996, Group sales totalled £5.4 billion with an operating profit of £1.04 billion …”

With regard to its pharmaceutical division, Zeneca’s leading pharmaceuticals are (http://www.zeneca.com/zpharma/glance.htm):

“… the world’s two most widely prescribed branded beta-blockers, ‘Tenormin’ and ‘Inderal’; ‘Nolvadex’, the world’s largest selling breast cancer medicine; and ‘Diprivan’ the world’s top-selling anaesthetic which is used routinely in both induction and maintenance of anaesthesia and also in adult intensive care sedation.

In 1995, these products helped boost Zeneca Pharmaceuticals’ sales beyond £2 billion for the first time in its history …

Zeneca Pharmaceuticals employs over 14,000 people. It has its headquarters in the UK, but over 93% of British production is exported and the business’ medicines are used in over 130 countries.”

Zeneca Plant Science also produces genetically modified tomatoes, amongst many other products (press release from Zeneca Plant Science, 27 September 1995, http://134.225.167.114/NCBE/NEWS/zps.html).

Orica is certainly not giving up the ghost however. In January 1998 it bought the rights to the Levene paint brand name and Levene’s Wairau Park “Levene Extreme” store on Auckland’s North Shore following Levene’s receivership, having bought Levene’s paint factory a year before (New Zealand Herald, 15/1/98, “ICI buys rights to Levene name”, p.D1).

In February Orica also bought H. B. Fuller Powder Coatings (New Zealand) Ltd in New Zealand and Australia from H.B. Fuller Company Inc of the U.S.A., again for a suppressed price.

“It is stated Orica NZ currently produces 1,400 tonnes of powder coatings from its existing manufacturing sites. The acquisition of the HB Fuller powder coating business in New Zealand will provide Orica NZ with the ability to significantly expand its existing power coatings and manufacturing facilities within New Zealand, which in turn will provide Orica NZ with the ability to meet the ever growing demand for supply within the powder coatings market.”

Fuller has a powder coatings manufacturing facility in Auckland plus sales and distribution in Australia and New Zealand. It employs about 65 people and has annual sales of NZ16.7m (Press, 24/3/98, “Orica purchase”, p.31).

H. B. Fuller is better known for its glues, which it supplies to the New Zealand timber industry for example. However its supply of glue elsewhere has been less benign and has raised big question marks over its ethics. Multinational Monitor, December 1995, reported (“Glue Maker’s Image Won’t Stick”, by Paul Jeffrey, pp 17-20) as follows:

“GUATEMALA CITY – THE H.B. FULLER COMPANY’S employee profit sharing, corporate giving and funding of a University of Minnesota chair in corporate ethics have won it rave reviews from the Socially Responsible Investment (SRI) community and a listing in the book The 100 Best Companies to Work for in America.

South of the Rio Grande, however, this transnational, with 1995 revenues of $1.1 billion, supplies the drug of choice to Latin American street children seeking an escape from poverty, abuse and family disintegration. How does a company that makes a product that does neurological damage to the brains of tens of thousands of children earn rave reviews among self-described socially responsible investors? …

For more than two decades, Central American plants of St. Paul, Minnesota-based Fuller have produced shoemaker’s glue containing toluene, a sweet-smelling hydrocarbon neurotoxin. Millions of Latin American street kids inhale this shoe glue. The kids are often called resistoleros, a reference to Fuller’s Resistol glue…

The adhesive’s fumes go straight to the frontal lobes, the switchboard of the brain, and to brain areas that control emotions. Resistol turns off the brain’s connection to reality, neutralizing stress, pain and fear, taking the place of parental affection. Short-term use can produce nosebleeds, rashes and headaches. It can also lead to long-term use because toluene is psychologically addictive. Chronic abuse can cause neurological damage, kidney or liver failure, paralysis and death.

Fuller insists that the glue was designed for shoes, not immature brains, and that the company is not responsible for product abuse. ‘We don’t sell to street children. We sell to legitimate users who are manufacturing a product,’ says Dick Johnson, Fuller’s executive vice president for investor relations. ‘If people, children or adults, get it illegitimately, that’s a concern to us, but you’ve got to remember that’s not our main focus.’

Activists counter that glue makers can address the abuse problem in the production process. In 1968, the U.S.-based Testor Corporation became an industry model when it added mustard oil to model airplane glue. At a negligible cost, mustard oil made the glue difficult to inhale, dramatically reducing Testor glue abuse – and sales.”

They asked other manufacturers to follow Testor’s lead, but the manufacturers, including, Fuller, refused.

“In 1989, the Honduran Congress passed a law that required the addition of mustard oil to toluene-based products. Fuller responded with a lobbying blitz. David Calvert, an advocate for street children in the Honduran capital, Tegucigalpa, says Fuller barraged shoemakers with claims that mustard oil would endanger their health, a tactic he called a ‘campaign of lies.’ Whatever it was, it worked. A government commission decided that toluene products in Honduras need not contain any mustard oil…

On the ground in Central America, activists – some of whom have received Fuller funding – say Fuller executives could curb inhalant abuse if they did not have such a nose for profit. ‘They’ve been very stubborn,’ says Covenant House Latin American Director Bruce Harris, who says that adding mustard oil to Resistol would cost just seven cents a gallon. Fuller has not funded Covenant’s programs for street kids – including resident programs to help kids break their glue addictions – since the charity criticized company policies.

‘It’s fair to say that when someone we’re funding begins speaking critically of us, we’re less inclined to continue funding,’ says Fuller’s Bill Belknap. Fuller still funds other outreach programs ‘that share our viewpoint of the complexity of the issue,’ he says.

‘Of the 40 to 50 million street children in Latin America, more than half sniff glue,’ Harris says. ‘Hard-core users go through about a gallon a week. That’s up to 20 million gallons a week. Do they [Fuller] really want to lose that market?’…”

ABN AMRO of the Netherlands buys BZW from Barclays

ABN AMRO Australia Ltd, which is ultimately owned by ABN AMRO N.V. of the Netherlands (through its subsidiary, ABN ANRO Bank N.V.), has approval to acquire BZW New Zealand (Holdings) Ltd from Barclays Bank Plc for “approximately $12.5 million“. BZW New Zealand (Holdings) Ltd owns BZW New Zealand Ltd and BZW New Zealand Nominees Ltd.

“The acquisition forms part of a wider transaction involving the purchase of shares and assets in Australia. It is stated that Barclay’s Bank Plc have informed the London Stock Exchange that it wishes to divest itself of its Australasian banking business. ABN AMRO state the acquisition of BZW forms part of its overall business strategy to provide global banking services.” [sic]

According to Reuters, the total deal was $200 million for BZW’s operations in Australia and Aotearoa. The name BZW would disappear (Press, 23/12/97, “BZW brand about to disappear”, p.20). ABN AMRO Bank, which is among the top ten banks in the world by capital, has registered as a bank in Aotearoa, operating as a branch (Press, 3/3/98, “ABN AMRO registered”, p.35).

BZW first made its appearance amongst the OIC’s decisions in November 1992, when we reported:

“Barclays Bank (U.K.) subsidiary BZW New Zealand Ltd (Barclays de Zoete Wedd) has been given blanket consent by the OIC “to acquire shares … in New Zealand listed companies”. Nothing could illustrate more clearly the vacuousness of the scrutiny given by the OIC to overseas investment in this country. Even its expressed “benefits” come down to no more that it will make overseas purchase of Aotearoa company shares more attractive: “BZW’s principle activity is the buying and on-selling of stock exchange listed securities. BZW is seeking to undertake major bought deals (being deals whereby the pricing risk is borne by the broker). The Commission is advised that the proposal will create a greater liquidity for the holders of securities of New Zealand companies, which will enhance the attractiveness of investment in New Zealand companies. This in turn will support an increase in the availability of equity capital.”

ABN (Algemene Bank Nederland) has been involved for some time in Aotearoa. One of its escapades was scarcely bathed in glory. In April 1992 we reported that CDL Hotels of Singapore had taken control of Euro-National Corporation Ltd, with 89% of its shares. Euro-National, in which ABN subsidiary ABN Nominees (Malaysia) SDN BHD was then a major shareholder, was the shell CDL used to create what is now the largest hotel chain in Aotearoa. Describing Euro-National’s past as “one of the grubbiest episodes in recent commercial history”, we reported:

“Euro-National was a merchant bank started during the yuppy feeding frenzy of the mid 1980s, and which until the CDL takeover was a ‘cashed-up shell’ hovering around liquidation… What brought it to public notoriety was that a Malaysian stockbroker, Hwang and Yusoff bought 49.46 percent of its shares – and then proceeded to try to strip the company of $21.2 million of its liquid assets. The High Court took a dim view of this and took the unprecedented action of forfeiting 20 percent of its shareholding – equivalent to a fine of about $1.8 million. Hwang and Yusoff also had to sell their remaining shares within six months.”

Hwang and Yusoff managed to interest CDL in the company, including ABN’s share.

ABN (through ABN AMRO Participates B. V.) is also a 17.4% shareholder in Barenbrug Holdings B V of the Netherlands, which we reported in January 1997 had approval to acquire up to 74% of Agriseeds Holdings Ltd, which breeds, produces and markets seeds. Both companies specialise in grass seeds.

Goodman Fielder buys out dairy industry shares in Aspak (Meadow-Lea)

New Zealand Margarine Holdings Ltd, a subsidiary of Goodman Fielder Ltd of Australia, has approval to acquire the remaining 67% of Aspak Foods Ltd from Milk Products Holdings (N.Z.) Ltd (a subsidiary of the New Zealand Dairy Board) and Aspak Equities Ltd (owned by “various dairy companies”). The price was originally suppressed but was released on appeal in June 1998: “approximately $30 million“. Margarine Holdings already owned 33% of Aspak Foods, and “the remaining shareholders, namely Milk Products and Aspak Equities, have been looking to dispose of their respective shareholders [sic: we presume this means shareholdings!] for some time”.

Aspak Foods processes edible oils and makes margarine. Each of the companies had owned one-third of Aspak Foods since 1989 (Press, 12/2/98, “Aspak Foods bought out”, p.21). It makes the Meadow-Lea brand of margarine, and the operation was an attempt by the Dairy Board to hedge its bets on butter.

Aspak had previously expanded, buying Abels from Unilever in 1995, and closing Abel’s Newmarket, Auckland, margarine factory, moving production to its own new factory in East Tamaki. In November 1996, Aspak then sold Abels’ bakery raw materials division to N.Z. Bakels Ltd, owned by EMU AG of Switzerland (ultimately owned by the EMU Foundation, a Liechtenstein Charitable Trust) (see our commentary on the November 1996 OIC decisions).

Natural Gas Corp., Bay of Plenty Electricity construct Kapuni cogeneration plant

Natural Gas Corporation and Bay of Plenty Electricity Ltd have set up a 50/50 joint venture to construct an electricity cogeneration plant at the Kapuni Gas Treatment Plant in Taranaki. The present OIC decision involves a very small part of the project: it is a retrospective approval (the plant is almost completed!) for the joint venture to acquire a lease over 0.1 hectares of land at Kapuni from Natural Gas Corporation for 19 years and 364 days (there must be legal significance in a 20 year lease!) for “an annual rental payment of $1.00 per annum”. The only reason it requires approval is that the land, when added to adjoining land owned by the Corporation or the joint venture, exceeds five hectares.

One partner in the joint venture is Kapuni Energy Ltd, which is a subsidiary of Bay of Plenty Electricity, itself a subsidiary of Power New Zealand, owned by Utilicorp of the U.S.A. and Mercury Energy. The other partner is Natural Gas Corporation Energy Ltd, a subsidiary of Natural Gas Corporation Holdings Ltd, owned 33.3% by The Australian Gas Light Company, 33.3% by Fletcher Challenge Utilities Investments, and 33.3% by “members of the public”.

Waratah Receivables sets up

Waratah Receivables Corporation NZ Ltd, a subsidiary of Waratah Receivables Corporation Pty Ltd of Australia, has approval to acquire “receivables and related rights” for zero dollars.

“It is stated Waratah intends to develop an administered securitisation programme in New Zealand which will allow corporates to diversity their funding sources, by giving them access to funds which are not marketed against that corporate’s lines of credit with its traditional lenders. It is stated further the proposal will promote a more efficient development of capital for corporates and banks, by freeing up capital which would otherwise be tied up in receivables. Overall it is stated the proposal will provide an improvement in balance sheet and solvency ratios for such corporates and banks.”

Taiwan shareholders buy remaining shares in Universal Beef Packers, Te Kuiti

Mystic Springs Investment Inc, a subsidiary of Wellroc Enterprises Co. Ltd of Taiwan, has approval to acquire the remaining 6.71% of Universal Beef Packers Ltd it does not already own, from Chung Chien Chang, a resident of Aotearoa, for $2,159,545.39. The company owns nine hectares of land in Te Kuiti where it has its abattoir, employing approximately 150 people.

“The proposal represents a share restructure in order to reduce UBP’s current debt equity. UBP state the proposal will also provide it with a basis for further expansion of its current operations. It is stated that the development of a new processing factory is proposed, which will employ approximately a further 50 persons.”

Mystic Springs was given retrospective approval to acquire the 93.29% of the shares of Universal Beef Packers and control the appointment of its board in August 1997. It was then described as being owned by Mr J. S. McMahon who held the shares as trustee for Ton Cheng Min (82.64%), Willy Muh (5.953%), Gin-Shiang Lin (5.413%) and Chung Chien Chang (5.992%). The rationale for the acquisition was identical to that quoted above.

Philippines businessman buys Lyttelton Marina

Pacific Marina Holdings Ltd, owned by Mr Victor Villavicencio of the Philippines, has approval to acquire Lyttelton Marina Ltd, Lyttelton Marina Management Ltd, and Canterbury Marina Ltd for $600,000. Approximately seven hectares of leasehold land is involved. The companies are owned by the Lyttelton Port Company, which is owned 66% by the Christchurch City Council, 14% by AMP, 4% by the Ashburton District Council, and 12% by “members of the public” (it is not clear who owns the other 4%); and the Banks Peninsula District Council. This privatisation of the marina is opposed by many locals. However the OIC insists that

“Mr Villavicencio has significant business experience with marina development and management including a leading interest in the Subic Bay marina development at Subic Bay (north of Manila). … The proposal represents the introduction of approximately $5,400,000 in risk capital which will ensure the development of the new Lyttelton Marina. The Commission is advised the Canterbury area is in desperate need of an upgrade/enhancement to its existing marina facilities. In addition it is stated the proposed development is fully supported by both the Lyttelton Port Company and the Banks Peninsula District Council. The port company and council originally planned to undertake the development themselves however, the initial offer did not proceed.”

PPL (“Dolly”) buys more Taupo land for inseminated sheep breeding

PPL Therapeutics (NZ) Ltd, a subsidiary of PPL Therapeutics Plc of the U.K., has approval to acquire 93 hectares of land on Tihoi Road, State Highway 32, at Whakamaru, Taupo for $1,250,000.

“PPL Therapeutics PLC is a United Kingdom public company primarily involved in the bio-production of commercially valuable therapeutic protein. … PPL intend to acquire the property for the purpose of expanding their existing inseminated sheep breeding programme located within the Whakamaru District. It is stated the proposal is likely to provide additional employment opportunities to the local community, and ensures PPL’s parent company ongoing commitment to its New Zealand operations evidenced with an estimated NZ$70 million being invested to see the development of a new purifying facility in New Zealand.”

PPL is the company which made headlines by cloning the sheep “Dolly” in the U.K. In May 1996 we reported that PPL Therapeutics had approval to acquire a 58 hectare farm at Whakamaru for $1,050,000. In that case, PPL proposed

“to use the farm to breed a production flock of transgenic ewes producing a human protein in their milk. Such an activity is subject to government approval to the importing of semen from transgenic rams into New Zealand. The flock will be farmed to provide milk which will be processed for the valuable therapeutic protein. The Commission is advised that if such approval is not forthcoming, the farm will be used to breed high health status animals for export to the United Kingdom.”

PPL, which is based in Edinburgh, specialises in producing “therapeutic proteins (or food proteins etc) in the milk of transgenic animals (mostly sheep)”, and exports to Western Europe, Australasia, the U.S. and Japan (ref: http://www.webscot.com/sba/ppl.htm).

In 1995 the Minister for the Environment, Simon Upton, announced that an application to field test genetically modified sheep had been declined, but this has since been reversed.

Milburn buys another 20% of McDonald’s Lime from Fernz

Milburn New Zealand Ltd, which is approximately 73% owned by Holderbank Financiere Glaris Ltd of Switerland, has approval to acquire a further 20% of McDonald’s Lime Ltd for $6,000,000, bringing its shareholding to 72%. The shares are being purchased from Fernz Corporation Ltd subsidiary Medisup Services Ltd. Involved is approximately 334 hectares of freehold land and approximately 64 hectares of leasehold land in Waikato/Central North Island (Te Kuiti, Otanake Survey District, Pukunui, Aorangi and Rangitoto Tuhua). McDonald’s is engaged in “quarrying limestone and the production of industrial and agricultural lime” and “Milburn’s primary business activities include quarrying, cement manufacture, bulk cement storage and lime works. Milburn also has concrete plants throughout New Zealand and operates shipping routes around New Zealand.”

L&M of Switzerland, Hong Kong, and the U.K., buys 92 ha. for mining in Otago

L&M Mining Ltd, owned by Auriferous Mining Ltd of Switzerland, Hong Kong, and the U.K., has approval to acquire approximately 92 hectares of land in Glenmore, Milton, Otago (adjoining conservation land) for $750,000 for mining. The vendors, the Clark family will continue to farm the land that is not being mined.

L&M claims that it “has a history in New Zealand as a prudent and environmentally sensitive miner including the rehabilitation and restoration of mined land back to productive farmland.” Nonetheless, “the proposed acquisition will enable L&M to maximise the return from the ore resources contained on the property.”

Auriferous is equally owned by Tangent International Ltd, majority owned by Werner Muller of Switzerland; Campanie International Holdings Inc, majority owned by Kwok Wai Chiu of Hong Kong; and Rysaffe Trustee Company Ltd as trustee for Geoff London of the U.K.

Auriferous bought L&M and DML Mining from the Skellerup/Maine group in February 1997 as one of a number of sales by Skellerup prior to its crash. It was stated then that “without the involvement of Auriferous the outlook for the business is at best a severe reduction in the size of the business or at worst its failure.” It is therefore unclear what value to put on L&M’s “history in New Zealand as a prudent and environmentally sensitive miner” given that its ownership has changed.

FAI Properties buys Downtown Centre, Auckland, from St Lukes

FAI Properties NZ Ltd has approval to acquire The Downtown Centre, on the corner of Customs and Lower Albert Streets, Auckland Central, from St Lukes Group Ltd for $41,000,000. FAI Properties NZ is owned 51% by M. and C. Investments which is two family trusts whose trustees are Allan Brooke Mitchell and Clifford James Cook of Aotearoa; and 49% by FAI Overseas Holdings Pty Ltd, a subsidiary of FAI Insurances of Australia. The Downtown Centre is on 0.6770 hectares of land. FAI is “an active property investor” but they “propose to further develop/enhance ‘the Downtown Centre’ and its associated car parking facilities.”

Massey land bought by Universal Homes from Fletcher Homes for subdivision

Universal Homes Ltd, of China, has approval to acquire 4.8 hectares of land in Rush Creek Drive, Massey, Auckland, from Fletcher Homes Ltd for residential subdivision, for $2,850,000. The land adjoins a designated recreational reserve. Universal Homes is owned by China Everbright Pacific Ltd, which is listed in Singapore but owned 27% by China Everbright Holdings Ltd of China. The land is currently being developed by Fletcher “but has become surplus to their requirements”. “UHL intend to develop the property in two stages creating approximately 115 housing sites, aimed at the affordable housing market, in a bid to combat the current housing shortage faced by Auckland City residents.” Universal last received approval to purchase land for subdivision in October 1997. That was in Silverdale, Auckland.

Refusal then approval in one month: Australian couple buy 142 ha. in Waikato

Robert Pryke Investments (NZ) Ltd owned by Mr Robert Lindsay Pryke and Mrs Joan Carol Pryke, both residents of Australia, have had an application to buy land in the Waikato refused, then approved within the same month. The land is a dairy farm of approximately 142 hectares at Grove Road, Te Pahu, near Hamilton, for $1,900,000. On 4 February the application was refused because “it was not considered to be in the national interest”. Yet by 27 February, it was “approved as it met the criteria”:

“The Commission is advised the applicants’ have business experience and acumen and are demonstrating financial commitment proposal. The Commission is further advised the applicants’ are of good character and not the kind of persons referred to in section 7(1) of the Immigration Act 1987. The Commission is further advised that the Prykes’ are in the process of taking up New Zealand permanent residency and wish to acquire the property for the purpose of an investment and place of residence for when they take up permanent residence. The property will continue to be utilised as a dairy farming unit for dairy production under the management of a 50/50 sharemilker. In addition it is stated the Prykes intend to ensure the property is kept in a productive use for dairying, increasing production where possible, using modern dairying techniques whilst at the same time, protecting the environment and respecting the areas which have been planted in trees on the property to date.”

Nothing very special there. Presumably, their lawyer, Mr S. Makgill of McCaw Lewis Chapman of Cambridge, didn’t at first write the correct magic incantation that allows everyone else through on such flimsy evidence of “national interest”.

New Zealand Aluminium Smelters buys land from Comalco for Tiwai Smelter

New Zealand Aluminium Smelters Ltd has approval to acquire approximately five hectares of land at Tiwai Point, Southland from one of the company’s owners, Comalco New Zealand Ltd, for $2,000. The land adjoins the company’s Tiwai Point aluminium smelter.

“Since 1969 NZAS has operated an aluminium smelter at Tiwai Point, comprising approximately 87 hectares in area. The smelter produces aluminium, aluminium alloys and other aluminium products, and has a productivity [sic] capacity of 313,000 tonnes per annum. The transfer of the land will legalise a previous boundary of convenience, between the parties, following the upgrading of Tiwai Point undertaken in 1996. In essence the transaction ensures that NZAS is the registered proprietor of the land upon which the smelter is located.”

New Zealand Aluminium Smelters Ltd is 79.36% owned by Comalco New Zealand Ltd and 20.64% by Sumitomo Chemical Company Ltd of Japan. The OIC states that Comalco New Zealand is “wholly owned through two holding companies by Comalco Ltd, a company incorporated in Australia“. In fact Comalco is part of the Rio Tinto empire, the largest mining company in the world, based in the U.K.

Land for forestry

• Blakely Pacific Ltd (as trustee of the South Blakely Trust) of the U.S.A., has approval to acquire three hectares of land at 1729 Te Matai Road, Te Puke, Bay of Plenty for $160,000 as residential accommodation for its (yet to be appointed) on-site manager for the adjoining forests and its other forests in the area. It sold the property to the current vendors for a lifestyle block in September 1995. The last time Blakely applied for approval to buy land for its forestry holdings was in November 1997 when it bought 1,176 hectares of land at Milton, Otago. In September 1996 Blakely acquired 1,849 hectares in Otago for forestry. They have over 6,500 hectares in the North Island.
• Hikurangi Forest Farms Ltd, owned by Glenealy Plantations (Malaya) Berhad of Malaysia, has approval to acquire the 555 hectare Tuahu Station, Tauwhareparae Road, inland from Tolaga Bay, East Coast (Gisborne) for $765,000. The land, part of which is held for conservation purposes under the Conservation Act 1987, “has been offered on the open market for a period in excess of five years” and is currently used for grazing. Hikurangi intend to convert the property for afforestation, incorporating it into their existing forestry holdings in the region. In October 1997, Hikurangi acquired the 420 hectare Weka Station adjoining its Waimanu Forest in the Waimata District, Gisborne, East Coast, for afforestation. Glenealy bought Hikurangi Forest Farms from Fletcher Challenge Forests Ltd for $210 million in December 1996 when Fletchers sold it to raise money for its Forestry Corporation purchase. Hikurangi now owns approximately 34,000 hectares of freehold land, forestry/cutting rights, and leasehold land on the East Coast.

Other rural land sales

• Clearwood Developments Ltd, owned 66.6% by E. J. Cleary and family of Ireland, and 33.3% by the K.B. and R.B. Lockwood family trusts of Aotearoa, has approval to acquire a 114 hectare dairy farm on Saulberty Road, Hamilton, Waikato, for $2,000,000 for residential subdivision. They intend to convert ten hectares of it to 33 “farm park” residential lots, each with power, telephone and water, and resell the rest as a dairy farm. In July 1997 we reported that Eire Cattle Company Ltd, owned by the Cleary Family Trust had approval to acquire 50 hectares of land on Plantation Road, Te Kauwhata, Waikato for $462,500 for dairy conversion and merging with the company’s adjoining property. The Trust’s trustees were Mr Eamon Joseph Cleary of Ireland and Mr J. Henderson of Aotearoa. The beneficiaries of the trust were Mr Cleary, his children, and “remoter issue”. The Cleary family also had other significant investments in New Zealand. In September 1996, Clearwood Developments Ltd received approval to buy seven hectares of land then used as a “residential lifestyle block” on Whatawhata Road, Hamilton, for $1,400,000, for residential subdivision. It was given approval to buy seven hectares at Tamahere, Hamilton for $900,000 in April 1996, also for subdivision.
• David Endersby, a U.K. citizen resident in Malaysia has approval to acquire 16 hectares of land in Renwick West, Marlborough, for $345,000. The land “forms part of a subdivision and development of a larger pastoral farm, which had become uneconomic”.

“Mr Endersby intends to establish a vineyard on the property and to ultimately produce his own label wine for export particularly to the Middle East. In addition, it is stated the vineyard will be developed within a three year timeframe. Mr Endersby and his wife who have both been granted New Zealand permanent residency status, advise they plan to reside permanently in Marlborough within the next 18 months following the sale of his business interests in Malaysia.”

• Tasman Agriculture Ltd, 54.77% owned by Brierley Investments Ltd of Malaysia, has approval to acquire 449 hectares of land in Blackgully Road, Heriot, West Otago for $2,170,000. Tasman will convert the current sheep/beef operation to dairying, as it has done with a large number of other farms.