AS the Consolidated Pastoral Co property portfolio sale process continues, vendors Terra Firma are keeping their options open about selling the assets as a single line, or breaking up the business.
From the outset when the sale was confirmed earlier this year, Terra Firma has said it would consider both options in the process being managed through Goldman Sachs and Knight Frank.
In an effort to explore all possibilities, CPC has approached specialist property agency Meares and Associates to “assist in the seeking of interest in the individual CPC holdings.”
In a statement to the market, company principal Chris Meares said CPC and Terra Firma had been “overwhelmed with the enquiry for individual properties.”
He suggested that the value of individual assets within CPC’s 16 Queensland, NT and WA grazing properties (see full list below) would range from $10 million to more than $150 million.
A breakup of the properties would obviously attract a much wider range of potential interests, from global investors through to individual family-scale cattle producers.
Beef Central understands that the development does not mean a change of strategy by Terra Firma, but simply confirms that it wishes to explore all possible sale options.
Running almost 400,000 head of cattle, CPC is the world’s largest private cattle producer.
Formed in 1983 by Kerry Packer with the purchase of the iconic Newcastle Waters Station in the Northern Territory, the business was subsequently sold in 2009 to UK private equity firm Terra Firma.
Today, CPC spans 5.5 million hectares of land across northern Western Australia, the Northern Territory and Queensland.
The focus for the NT/WA group is predominantly live export and breeding high quality composite cattle for the CPC Queensland backgrounding operations.
The northern Queensland stations are predominantly breeding properties, while the properties located in southern and western Queensland are used for backgrounding/ finishing and bull production.
The properties can be summarised as follows:
Source: Meares & Associates
In addition, CPC owns two feedlots in Indonesia located in Lampung (South Sumatera) and Medan (North Sumatera). The Lampung feedlot has 19,800 head capacity, while the Medan feedlot has a 7200 head capacity.
In March this year, CPC owners decided to put the entire portfolio to market, with various industry estimates valuing the business as high as $1 billion. A valuation carried out at the end of March apparently valued the business at $925 million, up from $880m a year earlier. Live export prospects have improved significantly since March.
Any station-by-station breakup of the assets would echo the 2003 sale of Stanbroke Pastoral Co, purchased in its entirety by the so-called Nebo group, which promptly broke up the assets at considerable financial gain. The move went against the widely-held belief that the ‘old Stanbroke’ would be preserved indefinitely in its original form. The question of a Stanbroke style bust-up of the CPC assets was raised in this earlier Beef Central story, published in May.
Second-round tender offers are apparently closing soon.