Foreign investment in Aotearoa/New Zealand
Overseas Investment Office – January 2016 Decisions
Germans Sell LeasePlan
LP Group BV TDR Capital LLP, United Kingdom (41.8%), Abu Dhabi Investment Authority, Abu Dhabi (20.3%), GIC (Ventures) Pte Limited, Singapore (19.5%), Arbejdsmarkedets Tillaegspension, Denmark (9.2%), PGGM NV, The Netherlands (7.9%), Goldman Sachs Group Inc, United States of America (1.3%), received approval for the indirect acquisition of rights or interests in up to 100% of the shares of LeasePlan New Zealand Limited (“LeasePlan NZ”) which is valued at over $100 million, through the Applicant’s acquisition of up to 100% of the shares of LeasePlan NZ’s parent company, LeasePlan Corporation N.V.
The vendor was Global Mobility Holding BV Volkswagen AG, Germany (50%) and Friedrich von Metzler, Germany (50%). The asset value was stated at $279,400,000 (LeasePlan NZ’s gross assets as at 31/12/14). The OIO simply states “LeasePlan NZ specialises in vehicle leasing and fleet management. The Applicant intends to make a longterm investment in LeasePlan NZ”. This is part of a $6 billion global deal.
Americans Buy Veda Group
Equifax Inc, United States Public (95%), United Kingdom Public (1.6%), Canadian Public (1.4%) and various overseas persons (2%), received approval for the acquisition of rights or interests in 100% of the shares of Veda Group Limited, the value of the assets of Veda Group Limited and its 25% or more subsidiaries being greater than $100m. The vendors were existing shareholders of Veda Group Limited, Australian Public (90.8%), United States Public (9%), New Zealand Public (0.2%) and various overseas persons (0.02%); asset value not stated, but greater than $100 million (the book value of the gross assets of Veda’s New Zealand subsidiary was recorded in its accounts as at 30/6/15 as $274,961,000).
The OIO states: “Veda Group Limited provides credit data information to businesses and consumers. It operates in Australia, New Zealand, South East Asia and Saudi Arabia. The business of Veda Group Limited is directly comparable to the business of the Applicant. The Investment represents an opportunity for the Applicant to expand its business, and is consistent with its strategy to focus on expansion into attractive new markets”.
Veda is one of the largest holders of information about individuals in Australasia, holding information on 16.5 million credit active people and 4.4 million businesses. See our July 2011 commentary for details of a private equity group’s purchase of Veda. Rob Stock at Stuff reported on the deal (26/2/16): “Veda, which holds credit files on New Zealanders, has been sold to United States company Equifax. In time, the Veda brand will disappear in New Zealand to be replaced by the Equifax brand, which now operates in 24 countries including the US, Canada, Britain and India”.
“Equifax is listed on the New York Stock Exchange. Veda in New Zealand was part of the Veda Group, which was listed on the Australian Stock Exchange until the change of ownership on Friday. Veda compiles credit files on individuals and companies, which lenders and other businesses can use to determine whether to lend to them, or to provide them with goods and services. It is entering a new era with comprehensive credit reporting (CCR) in New Zealand”.
“CCR allows credit reporting agencies like Veda to collect information not only on missed payments and credit defaults, but also ‘positive’ information on when consumers pay bills on time. Equifax’s John Hartman, President of Equifax’s International Operations, said the purchase of Veda, which operates in New Zealand and Australia, was a key part of Equifax’s strategy to expand into the Asia-Pacific region”.
“‘We do not have a strong presence in this part of the world, in the Asia-Pacific Rim, but it has been our priority to establish a presence here’, Hartman said. New Zealand offered an attractive income to Equifax and also opportunities for growth. ‘Over time I would expect the brand to migrate to our global brand of Equifax’. Many commercial customers already know the Equifax brand, Hartman said. Equifax said the purchase will not affect privacy protections offered by the Privacy Act”.
UAE Buys Fastway Couriers
Aramex New Zealand Holdings Limited, Aramex PJSC, United Arab Emirates (100%), received approval for the acquisition of rights or interests in 100% of the shares of the shares of Fastway Limited, the consideration of which exceeds $100m. The vendors were existing shareholders of Fastway Limited, New Zealand Public (71.4%), Australian Public (16.8%), Monaco Public (11.6%) and United Kingdom Public (0.2%): consideration was $125,277,000.
The OIO states: “The Applicant’s parent Group (Aramex) is a global provider of comprehensive logistics and transportation solutions and operates a franchisee courier system across a number of locations around the world. Aramex intends to incorporate the Fastway business into its global business. Aramex’s current intention is to retain the employees of Fastway and invest further to grow the Fastway business”.
Catherine Harris at Stuff reports on the rationale for the deal (21/1/ 16): “A large number of Hawke’s Bay shareholders may have received quite a windfall from the $125 million sale of courier company Fastway. The privately owned company has been sold to Dubai-based logistics firm Aramex. The deal was made public on Thursday after gaining Overseas Investment Office approval”.
“Beginning as a two-van courier company in Napier in 1983, the firm has a turnover of $500 million a year, including franchise operations. Fastway’s Managing Director, Bruce Speers, said many shareholders had been with the company for 30 years. “It was basically an opportunity for our existing shareholders to exit the business and make a good return on their initial capital investment'”.
“But it was also a good opportunity for Fastway, he said. ‘In the courier business at the moment, we’re seeing some consolidation and it’s becoming really important to be able to operate on a global platform. Certainly what this transaction does is elevates us to being a global player’. Fastway’s existing network includes 62 regional depots and 1,500 franchisees across Australia, New Zealand, Ireland, Northern Ireland and South Africa. It has more than 250 franchise holders across New Zealand alone, and transports more than 30 million parcels globally a year”.
“The deal involves Fastway’s core business in New Zealand and Australia, but not its franchisees in Ireland, Northern Ireland and South Africa. Speers said the company would retain the Fastway name and have better access to parts of the world that would have been costly to reach. ‘The way the online business is becoming such an important part of the industry now, it’s really important you have a global reach. For us to be able to play into China or into the Middle East or even into the Americas, that would have been for us … a massive investment'”.
Aramex is listed on the Dubai Stock Exchange and its Chief Executive, Hussein Hachem, said it liked Fastway’s operating model. ‘The company has a strongly performing business, a well-recognised brand, a leadership position in the Asia-Pacific market, an excellent management team and large global customer base. Following our recent deals in Thailand and Australia last year, acquiring Fastway is the next logical, strategic move for us’. Fastway was started by Bill McGowan as HB Couriers, who later renamed it. The company crossed the Tasman ten years later, followed swiftly by several other countries”.
Malaysians �Sweeten� Arrowtown Purchase
Glenorchy Homestead Limited, Malaysia (85%) and Singapore (15%), received approval for the acquisition of a freehold interest in 19.2 hectares of land at 761 Malaghans Road, Arrowtown. The vendor was Paul Adrian Davies, New Zealand (100%): consideration was $2,700,000. The OIO states: “The Applicant intends to acquire the property for use as a home by the persons with control of the Applicant when they visit New Zealand”.
“The Applicant will consult with the Department of Conservation (DoC) to determine what the Applicant can reasonably do to protect or enhance any existing areas of significant indigenous vegetation or significant habitats of indigenous fauna on the land, and implement (at the Applicant’s cost) any environmental protection reasonably recommended by DoC. The Applicant will also make a $100,000 donation to the Wakatipu High School Foundation, which must be used to provide financial assistance or hardship allowances for students at the school”.
Stuff reported on the controversial approval (17/5/16): “The sale of sensitive land near Queenstown went ahead after the buyers agreed to donate $100,000 to the local high school to fund iPads and laptops. David Chuang and Lim Mee Len were approved by the Overseas Investment Office (OIO) to purchase for $2.7 million a 19-hectare piece of Arrowtown land, under the name Glenorchy Homestead Limited, in January. The pair is the wife and son of Singapore rich-lister John Chuang, who made his millions in the chocolate confectionery business”.
“It was previously reported the applicants planned to use the property as a home. The condition for approval was the buyers donate $100,000 to the Wakatipu High School Foundation. The decile-10 secondary school has a ‘bring your own device’ policy as a requirement for all 850 students. The school’s Principal, Steve Hall, wrote to the OIO saying 5% of all students would need their full cost of devices to be covered, and 25% would need to be partially covered, with the rest not needing assistance”.
“About $70,000 of the sum would go toward assisting parents to buy devices, and $30,000 would go toward training teachers, he wrote. ‘In addition to the funding assistance required for families for devices, professional learning for staff will need to continue in order to prepare staff to provide the best possible learning experiences for students’. Labour’s education spokesman, Chris Hipkins, said the Government must address the inequality of laptops and tablets in classrooms. ‘If parents at a decile 10 school can’t afford digital devices for their kids, how can those at other schools be expected to?’ he said”.
“‘School kids shouldn’t have to rely on overseas investors to ensure they get their fair shot at education. The law guarantees every Kiwi kid a free schooling, and that’s what the Government has a responsibility to fund’. The Minister of Education, Minister for Land Information and the Overseas Investment Office have been contacted for comment. The Government does provide for Internet funding, investing more than $200 million in the ‘N4L Managed Network’ so all State, State-integrated and partnership schools can have secure and uncapped Internet”. Laptops and iPads really are the electronic equivalent of blankets and beads for the natives. Stuff further reported (17/5/16) that foreign land buyers have donated money to 16 education providers since 2009 to help their applications succeed. Ed.
Aussies To Establish Queenstown Polo Ground
In another Queenstown purchase, TJ Investments Pte Limited, Jonathan Paul Gabler, Australia (50%), and Lynly Wai Yen Fong, Australia (50%), received approval for the acquisition of a freehold interest in approximately 85 hectares of land at 629 Malaghans Road, Queenstown, Otago. The vendor was TA Property Trust Limited, Coronet Estate Limited, Malaghan Park Limited, Arrowtown Downs Limited and Wakatipu Retreat Limited, AF Porter Family Trust, New Zealand (33%), Neville Porter Family Trust, New Zealand (33%), John Porter Family Trust, New Zealand (33%), and BSA Trustee Company No. 2 Limited, New Zealand (1%): consideration was $4,226,087. The OIO states: “Lynly Fong and Jonathan Gabler are purchasing the land in order to establish a polo facility in Queenstown”. See our April 2016 and September 2008 commentaries for details of other Queenstown area purchases by Lynly Fong.
And A Five Star Resort For Queenstown
And in yet another Queenstown purchase, Horizons Investment Trust – Lot 1, Adam Wayne Smith, New Zealand (100%); Wild Grass Limited Partnership – Lot 2, Australian public (76%), and various overseas persons (24%); Wild Grass Investments No.1 Limited – Lot 3, Adam Wayne Smith, New Zealand (75.5%), and Australian public (24.5%), received approval for the acquisition of a freehold interest in:
- approximately 14ha of land located at Jacks Point, Queenstown (Lot 1 DP 447241 – 201420096);
- approximately 24ha of land located at Jacks Point, Queenstown (Lot 2 DP 447241 – 201520074);
- of approximately 3ha of land located at Jacks Point, Queenstown (Lot 3 DP 447241 – 201520073).
The vendor was Jacks Point Land Holdings Limited New Zealand (100%): consideration was $5,000 (Lot1), $10,000,000 (Lot 2) and $10,000 (Lot 3). The OIO states: “The Applicants are joint venture parties who wish to develop a five star luxury resort over the three combined properties located at Jacks Point near Queenstown. The applicants have an agreement in place with a luxury premium five star resort group to manage the resort. The new Resort is intended to include a luxury Hotel (including restaurants, meeting facilities, fitness facilities etc) and Lodge, along with approximately 33 cabins, 14 two bedroom units plus 18 three bedroom residences”.
Confidential Decision
Apart from the case number 201420063 and that the applicant has satisfied the criteria in section 18 of the Overseas Investment Act 2005, all information pertaining to this approval has been “Withheld under s(9)(2)(b)(ii) of the Official Information Act”.
Other January Decisions
Yanqiu Qian and Jie Zhang, China, People’s Republic of (100%), received approval for the acquisition of a freehold interest in approximately 7.3 hectares of land at 262 Broomfields Road, Whitford, Auckland. The vendors were Clayton Reid and John Robert Kerridge as trustees of the Clayton Reid Residential Trust, New Zealand (100%): consideration was $9,700,000.
The OIO states: “The Investment will provide a family residence for the Applicants. It is also intended that part of the property will be used for pre-production and post-production work on TV series and films. The Applicants intend to become ordinarily resident in New Zealand, ceasing to be an ‘overseas person”‘ (as defined in section 7 of the Overseas Investment Act 2005). If this does not occur, or if either Applicant once again becomes an ‘overseas person’ after ceasing to be one, the Investment must be disposed of”.
Bernard Jean Sabrier, Switzerland (100%), received approval for the acquisition of a freehold interest in approximately 47.7 hectares of land at Lot 3 Mataka Station, Purerua Peninsula, Bay of Islands. The vendor was Laurent Esquier, United States of America (100%): consideration was $1,400,000. The OIO states: “The Applicant intends to acquire the land to preserve and enhance the natural environment in the vicinity of the properties he already owns at Mataka Station.
“The Applicant will make a donation to the Bay of Islands International Academy which will help address the school’s critical needs – namely the support of priority learners and special needs students, and the preservation of a languages programme in Te Reo Maori and Spanish” (more blankets and beads for the natives. Is this what our education system has to rely on now – charitable handouts and trinkets from foreign land buyers? Ed.). See our December 2002, March 2003, April 2011 and April 2013 commentaries for details of Sabrier’s previous land purchases here.
January 2016 Decision Released In Full
Takeover attempts on NZ Oil & Gas
Campaign Against Foreign Control of Aotearoa,
P.O. Box 2258
Christchurch.