Bay of Plenty iwi significantly stepped up investment in the kiwifruit sector with the purchase of one of the country’s largest privately held orchard investments, scooping the deal ahead of several interested foreign buyer groups.
The Matai Pacific orchard near Te Puke was offered by tender on behalf of its largely United Kingdom investor/owners to the market earlier this year, amid strong competition from both local and overseas interests.
But it was a joint venture between three Bay of Plenty iwi interests that managed to secure the 98 canopy ha property with its 2.6 million tray production of SunGold and Green, generating an estimated $11.4 million to $12.3 million a year income.
Rotorua based Te Arawa Group Holdings, Whakatane’s Ngati Awa Group, and Rotoma No.1 Incorporated, teamed up for the purchase. The acquisition consolidates the position of all three iwi groups as significant primary sector players within the region and the industry.
Based on current sales in the Western Bay of Plenty, kiwifruit orchards are selling for about $450,000 a hectare for Green and up to $1 million a hectare for SunGold.
The value of the deal has not been disclosed, but based on the orchards being split 50:50 between SunGold and Green fruit, estimates place the canopy area alone at a value of $65-$75 million. Additional assets include 100ha of pastoral land and two houses.
The deal also provided an option for the iwi groups to purchase $5.2 million of Zespri shares, on a recently re-aligned one tray: one share basis.
The move marks the second significant investment by iwi into the industry within the past year.
Last year, a $30 million investment programme to build 10 kiwifruit orchards in the BOP and Gisborne regions was announced as then single biggest investment.
That deal was proposed to be set up on 90ha of unproductive tribal land across the two regions.
BOP-based Te Awanui Huka Pak is another significant force in kiwifruit.
The 100 percent Maori-owned business has a 17 percent stake in major grower and post-harvest operator Seeka, while also retaining land holdings and buildings that bring its total investments to more than $20 million.
Te Arawa Group Holdings chairman Andrew West said the Matai Pacific purchase would ensure a brighter future for its people, delivering jobs and economic growth on the back of booming global demand for kiwifruit.
“This is an industry we know well and we have a proven track record of success,” he said.
Bayleys national country manager Duncan Ross said iwi should be applauded for getting the funds required together in a relatively short time, suggesting they have strong support from not only shareholders, but the banking sector too.
“And to be able to raise those funds to compete at the top end of a hot sector like kiwifruit is no mean feat.”
He said iwi assumption of ownership was very much a good news story for the sector, iwi and the region.
Bidding for the block had been strong in the tender process, with about two-thirds being local interest and one-third coming from overseas interests.
“These included parties who already had significant interests in the New Zealand primary sector.”
Collectively the three iwi groups now oversee significant resources in the Bay of Plenty, with Te Arawa representing 21,000 beneficiaries, Rotoma No.1 administering 6600ha on the shores of Lake Rotoma for 1800 iwi shareholders, and Ngati Awa Group managing assets for 22 hapu representing 20,000