Kidman standoff as Aussie farming group offers $386m to beat Rinehart

Santa Gertrudis steers at S. Kidman and Company’s Tungali Feedlot, Sedan, SA, which new bidder, the BBHO farming consortium, intends to maintain as part of its $386 million bid for the company.The 18-month battle for the 117-year-old Kidman pastoral estate has entered uncertain territory again as a $386 million challenge goes up against Gina Rinehart’s bid with Chinese partner, Shanghai CRED.
Nanjing Night Net

The all-Australian farming family syndicate’s bid for the 10.1m hectare outback operation, including the huge Anna Creek Station, is being prepared for presentation to S. Kidman and Company after just gaining majority financial backing from Rabobank.

The offer, announced early this week, trumps Mrs Rinehart’s Australian Outback Beef (AOB) partnership’s plan to pay about $365m.

AOB’s purchase arrangements have not involved retaining the 2.5m hectare Anna Creek and its outstation “The Peake”, which have been considered likely to sell to the South Australian-based Williams Cattle Company.

No value has been put on Anna Creek, but its sale has been guessed by industry observers as likely to be worth about $15m-plus to Kidman shareholders.

Although AOB was granted preferred bidder status by Kidman and Co after announcing its plans two weeks ago, its official bidder’s statement is also yet to be submitted to the Kidman board.

Pastoral industry observers believe it quite likely AOB will now also be working hard to outpace the latest offer before the Australian farming groupgains muchmomentum.

Advisors to the new contenders, the Brinkworth, Buntine, Harris and Oldfield (BBHO) families, are expecting their counter bid statement will be presented to Kidman and Co within weeks.

BBHO’s bid is for at least 90 per cent of Kidman and Company’s family shares held by descendents of revered cattle king Sir Sidney Kidman, and some long-connected families.

The consortium, which involves prominent grazing, cropping and livestock transport sector leaders, Tom Brinkworth, Sterling Buntine, Malcolm Harris and Viv Oldfield and their families, believes it has a “compelling and superior proposal”.

“We look forward to the opportunity to progress discussions with the Kidman board,” said consortium spokesman and Top End pastoralist, Sterling Buntine.

Like AOB –which is 67pc owned by Mrs Rinehart’s Hancock Prospecting and one third by Shanghai CRED –the BBHO team has committed to maintaining Kidman’s Adelaide office and its Tungali feedlot at Sedan in South Australia.

The group wants to work with current Kidman management and staff to implement “growth and development opportunities for the business”, including marketing beef produced by the partners and Kidman’s 19 properties under the Kidman name.

This would more than treble the size of the herd currently marketed under the Kidman brand.

The Kidman business operates up to 185,000 head in Western Australia, Queensland, SA and Northern Territory.

The four families plan to own separate Kidman properties in each of their four names, however Mr Buntine insisted the consortium did not want to see the estate broken up and sold off as had been done when AMP’s Stanbroke Pastoral Company was sold in 2003 for close to $500m and dividedbetween about six main bidders.

“Our four families are deeply committed to honouring and preserving the Kidman heritage and brand which will continue under the stewardship of highly regarded and successful Australian graziers,” he said.

“As Australian grazing families, we share a strong affinity with the Kidman properties.

“The Kidman story and legacy of Sir Sidney Kidman is in the DNA of our cattle industry.

“Sir Sidney was a pioneering nation-builder whose values and vision helped build Australia into a respected leader in the global beef industry.”

Apart from offering more money, Mr Buntine said BBHO’s proposal did not not require Foreign Investment Review Board (FIRB) approval, which meant it also offered more certainty for the Kidman shareholders.

Although the BBHO families have not been given access to Kidman properties to help them prepare their bid, their widespread experience in the WA, NT, SA and NSW livestock industries has been deemed enough to put their figures together.

The families had been vying for at least some of the Kidman landsince itsboard first put the business up for sale in April last year.

Mr Buntine noted his father had carted cattle for Kidman for many years, while several members of the Oldfield family “earned their stripes” as drovers on Sir Sidney’s properties.

“More recently, the Brinkworth family’s epic 18,000-head cattle drive from central western Queensland to southern NSW followed in Sir Sidney’s similar footsteps from earlier this century,” he said.

Mr Buntine returned to his Kimberley base in WA this week after spending several dayswith other consortium members in Sydney and Canberra lobbying for political support for the bid.

His own WA, NT and Queensland holdings total almost 3m ha, while Mr Brinkworth and his wife Pat, from Kingston, SA, have about 1m hectares to their family’s name.

One-time NSW farmer Mr Harris is based at Gogo Station in the Kimberleyand has properties in Queensland, while the Oldfield family has cattle and trucking operations based around Alice Springs.

This story Administrator ready to work first appeared on Nanjing Night Net.