Canadian pension fund AimCo has expanded its footprint in the northern Australian beef industry, agreeing to terms with administrators KordaMentha to purchase the beleaguered Kimberley Meat Co beef processing plant in Western Australia’s remote Northeast.

The deal has received initial approval from administrators, but awaits Foreign Investment Review board approval, an ABC report says. Creditors involved in the collapsed Kimberley Meat Co have voted to accept a deed of company arrangement proposal from AIMCo.

AimCo, standing for Alberta Investment Management Corporation, already has pastoral assets in the region, having earlier purchased Yougawalla Pastoral Co, an operation across seven pastoral leases on 2.9 million ha of rough Kimberley country.

AIMCo is one of Canada’s largest institutional investment managers, investing globally on behalf of pension, endowment and government funds in the Alberta province. The company has invested in Australia for many years, firstly in forestry and most recently in agriculture through the acquisition of mixed-farming business Lawson Grains in January 2022.

It has since added two grazing/farming holdings in New South Wales: Jemalong Station near Forbes, and Green Park near Rand.

The Kimbery deal is understood to include both the Kimberley Meat Co processing plant assets, plus associated cattle properties Yeeda and Mt Jowlaenga stations outside Broome held under parent company Yeeda Pastoral Co. The Yeeda pastoral aggregation covers 475,000ha of mostly leasehold country. Included in the offering were around 13,800 cattle, counted in a partial muster in October last year.

The Kimberley processing assets will be managed through TLPH Holdings while AimCo’s Australian agriculture investment manager New Agricultre, established to both manage Lawson Grains and to build a portfolio of agriculture assets globally, starting in Australia and New Zealand, will manage the pastoral assets alongside the Yougawalla pastoral interests.

New Agriculture is backed by New Forests, founded in 2005 in Sydney as a global investment manager of nature-based real assets.

2025 re-opening likely

Sources suggest the Kimberley Meat Co plant will be readied for operations starting around February March next year, processing a combination of company-owned and bought cattle, mostly manufacturing types, for export.

The new owners could hardly have timed their entry into Australian meat processing more favourably, with considerable momentum in export demand and prices being seen this year – especially for frozen manufacturing beef like that produced out of KMC growing by the day.

Kimberley Meat Co is Australia’s most remote beef processing facility of any scale, located about 100km southwest of Derby. The next nearest processing plants are located 2400km away near Perth, or 2700km away in South Australia.

In a letter delivered to Yeeda Pastoral Co creditors, AIMCo’s Jonathan Braams said the company intended to recommission the plant under new management. Strong animal welfare, environmental, social and governance standards would be put in place, the letter read.

In mid May, administrators Richard Tucker, Anthony Miskiewicz and David Osborne from KordaMentha closed expressions of interest in the Kimberley Meat Co plant plus grazing assets. A source close to the sale process said at the time that ‘significant interest’ had been shown from both domestic and offshore inquiry in the processing facility, but he declined to offer a number about how many formal expressions had been received.

“Interested parties know there is an absolute obligation to sell. That does not necessarily mean it sells at a bargain basement price, it’s about creating market tension to get a fair price,” he said.

An earlier administrators’ earlier report suggested the companies were $103 million in debt at the time they entered voluntary administration, split roughly equally between secured and unsecured creditors. The largest was the Commonwealth Bank of Australia, owed $43.6m.

High expectations when built in 2016

The Kimberley Meat Co plant was built in 2016 by Merv Key and his partners including Yeeda founder Jack Burton.

In 2021, KMC’s owners attempted to create a cooperative designed to transfer ownership to local landholders. The WA state government apparently intended funding the local pastoralists into the deal, but allegedly pulled out at the final stage.

Daily production capacity at the plant is around 220 head, with an annual season around 40 weeks, accounting for around 45,000 head a year.

The processing plant only operated briefly at a low output level earlier this year, and was closed for lengthy periods over the previous two years due to large numbers of cattle being relocated out of the Kimberley for restocking in other parts of Australia after drought.

KMC reopened briefly in April 2023, operating as a wholly-owned subsidiary of Yeeda Pastoral Co.

Merv Key sold his 45 percent stake in the plant, together with his share of parent company Yeeda Pastoral Co, to one of his existing partners, ADM Australia, in October last year.

The ADM group’s major shareholder is Hong Kong-based equity fund Asia Debt Management Capital (ADM Capital), which has agricultural investments worldwide, including irrigated tree cropping, stockfeed and commodities trading businesses in Australia. Yeeda and Kimberley Meat Co were ADM’s first investments in the Australian red meat supply chain.

The balance of the KMC/Yeeda shareholding (20pc) was owned by another long-term investor, Fitzroy River Ltd, described as a family office based in the US and Argentina which has held a stake in Yeeda for the past ten years. Kimberley Meat Co preferred to keep its heavy foreign capital exposure discrete.