Fractional property investment firm DomaCom has praised Treasurer Scott Morrison’s decision to block the sale of Kidman Station to a Chinese consortium on the grounds it could be contrary to the national interest.
DomaCom chief executive Arthur Naoumidis said it was very pleasing the government had acknowledged the outpouring of public sentiment on the proposed $370 million sale and had reached a preliminary finding to reject the bid by Chinese-listed Dakang Australia Holdings.
The company has until tomorrow, 3 May, to respond.
Morrison had earlier rejected a bid by a related Chinese company, Pengxing Group.
DomaCom launched an eleventh-hour book-build late last year to keep Kidman Station in Australian hands and over about three months 5000 retail investors had pledged more than $70 million.
“What the DomaCom campaign clearly demonstrated is that there is genuine public interest in keeping the iconic Kidman pastoral station in Australian hands, and that mum and dad investors want to have a stake in this country’s agricultural heritage,” Naoumidis said.
“Opinion polls have continually shown that ordinary Australians are deeply concerned about retaining our agricultural land, as well as the businesses that flow from them – what our crowdfunding proposal did was give them the opportunity to give expression to that concern.”
In April during the 2016 SMSF Members Association Conference in Sydney, Deputy Prime Minister Barnaby Joyce said he believed superannuation funds should engage in buying Australian property to halt the loss of local land assets to foreign residents.
“It frustrates me somewhat when we hear that the largest dairy farm in Australia, Van Diemen’s Land Company, sold the other day [to Moon Lake Investments, owned by a Chinese businessman],” Joyce said at the time.
“Let’s be honest with ourselves. Why didn’t a superannuation fund buy it?”
Naoumidis said Morrison’s overruling of the sale last Friday could breathe fresh life into the DomaCom offer.
“Hopefully it will encourage more retail investors to come forward to invest in Kidman,” he said.
“Aside from the issue of keeping it in Australian hands, the investment reality is that under our proposal the land will be separated from the operating business, with the land expected to return about 8 per cent to 9 per cent to our investors.
“We also hope it’s a wake-up call for our large super funds and asset managers to give a higher priority to agricultural investment to allow our prime pastoral and cropping land to remain in Australian hands.”
Morrison previously endorsed the decision to reopen the sale process for Kidman Station for Australian parties in February.
DomaCom entered the bidding for Kidman Station in December last year through its fractional property investment fund, which proposed crowdfunding the purchase of the station to give retail investors the opportunity to own part of one of the nation’s agricultural icons.
Kidman Station is an aggregation of 16 pastoral properties, including outstations and supporting properties in breeding, feedlot and cropping.
It is spread across Queensland, the Northern Territory, South Australia and Western Australia, and is home to 185,000 head of cattle.
