ABC Rural believes that one of Australia’s largest livestock companies was bought by a British investor for at least $ 500 million.
- CPC was bought by the owner of a UK private equity firm
- The deal includes nearly 300,000 cattle and 3.2 million acres of land in NT and Queensland
- CPC is one of the largest private livestock companies in Australia
The Consolidated Pastoral Company (CPC) was bought by Guy Hands and his family along with CPC management to close a deal marked October 2019.
The sale includes nearly 300,000 head of cattle, nine leases in the Northern Territory and Queensland with a total area of around 3.2 million hectares, and a 90 percent share in a feedlot business in Indonesia.
CPC’s properties include Newcastle Waters – made famous by its purchase by Kerry Packer in 1983 – Bunda, Dungowan, Wrotham Park, Allawah and Isis Downs.
The deal is of much greater value and involves significantly more cattle than the much-discussed $ 385 million transaction that Gina Rinehart and a Chinese company completed for S Kidman and Co in 2016.
Who is Guy Hands?
Guy Hands is a multimillionaire founder of UK-based private equity firm Terra Firma, which has invested € 17 billion in businesses worldwide since 1994.
Terra Firma bought CPC from Kerry Packer in 2009 for approximately $ 425 million and added several more livestock stations to its portfolio over the years.
In March 2018, Terra Firma decided to sell all or part of CPC as part of its ongoing investment strategy.
The company sold nine of its livestock – with total sales of approximately $ 310 million – to a mix of Australian and overseas buyers between 2018 and 2019.
In October last year, Mr. Hands announced that he would take a private stake in CPC and buy his own company.
“CPC is a high quality, well-run company with a strong position in a large and growing industry and in close proximity to major markets consuming beef,” Hands said in a statement.
“Even in Australia, where the beef industry standards are among the highest in the world, CPC stands out for its commitment to environmental protection, animal welfare, investing in people, good relations with Indonesia and innovation.
“I have great faith in the Australian agricultural sector and my family and I am very excited about the future of CPC and proud to work with its management team.”
CPC to continue business as usual
CPC’s executive director Troy Setter said the direction of the company will hardly change after the sale.
“We are very focused on further increasing the brand rates, increasing the kilograms of beef produced per animal, hectare and property, and placing a strong focus on animal welfare and the environment,” Setter told ABC Rural.
“But the development of the team and the employees at CPC is also very important for the Hands family and also for CPC.”
Mr Setter said Mr Hands has a strong belief in the future of the beef industry in Australia.
“In terms of a balanced investment portfolio – with our investment in Indonesia exposure to Australian agriculture and one of the fastest growing consumer markets in the world, and global consumer demand for Australian agribusiness – this is a really good topic to invest in long term,” he said .
Mr. Setter did not disclose how he or the CPC management were involved in the new ownership of the company.
“We have an investment structure where the management team is aligned with the Hands family,” said Setter.
CPC open to new opportunities outside of cattle
CPC’s Newcastle Waters Station was designated this month as the preferred location for a plan to build the world’s largest solar park.
The plan is backed by CPC and Mr Setter said the company will continue to look into other options outside of the pastoral space.
“We don’t have anything that size or size on the table right now, but we’re doing a land conversion from cattle to arable land in Queensland, and we started in the Northern Territory this year, but we’ve put it on hold.” Because of coronavirus ” said Mr Setter.
He said the entire sales process for CPC took longer than expected.
“We thought it would probably be two years, and we’ve done well through the third year,” said Setter.
“Coronavirus slowed down to get the last bit done, but we always thought it would take a few years.”
CPC’s leases for Carlton Hill Station in East Kimberley and Manbulloo Staiton in the NT continue.
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