AN application by Chinese investor Moon Lake Investments to buy Tasmanian dairy giant Van Diemen’s Land Company has been approved by the Foreign Investment Review Board.
The approval finalised earlier this week is conditional only on the buyer complying with Australian taxation laws.
Federal Treasurer Scott Morrison said he considered the national interest test and how it applied to the VDL case, including the likely impact on local jobs and increased investment to support economic growth.
Van Diemen’s Land Co was put on the market by owners New Zealand’s New Plymouth District Council last year. Moon Lake Investments made a $280 million binding offer last year to buy the company.The asset has been foreign owned since it was established on a royal land grant 190 years ago. It effectively makes the sale one foreign owner selling to another.
Mr Morrison said Moon Lake, owned by Chinese businessman Lu Xianfeng, had given guarantees all current VDL employees would be offered ongoing employment, on terms no less favourable than present.
Moon Lake has committed to undertake investment projects in the VDL farms, which Mr Morrison said would provide additional economic activity in Tasmania. Moon Lake estimates the investments will nearly double employment at VDL.
Mr Morrison said this would guarantee more than 140 local jobs, generate an intended additional investment of more than $100 million and an expected additional 95 jobs.
Moon Lake advised it intends to continue to supply the milk produced at VDL under the same contractual terms currently in place.
Mr Morrison said this provided assurance there would not be an impact on the supply of milk and milk products in Australia, and planned investments may increase milk supply to the domestic market.
He said the company also committed to honour environmental considerations and recognised the importance of areas of VDL’s operations to Aboriginals.
The company milks 17,890 cows over 7000ha of country, and has Tasmanian Government approval to expand operations by clearing more than 1800ha of native vegetation.
Businesswoman Jan Cameron planned to underwrite a rival bid for VDL, in an attempt to put the business into Australian hands.
Moon Lake Investments made a $280 million binding offer last year to buy the dairy company.
Late last year, New Zealand’s equivalent of the FIRB, the Overseas Investment Office, rejected an application by Chinese conglomerate Shanghai Pengxin Group’s $56 million bid to purchase the sprawling Lochinvar dairy farming operations in the South Island.