Mataura Valley Milk mum

01-06-2010 | Not Specified

Speculation is rife over likely Chinese investment in the Southland dairy industry as the Hong Kong-listed company Natural Dairy runs the ruler over southern farms.

Natural Dairy, headed by May Wang, is seeking Overseas Investment Office approval to spend $1.5 billion buying New Zealand dairy farms and processing plants with the Southland region joining the hit list as Natural Dairy seeks opportunity outside the North Island.

As Mataura Valley Milk (MVM) talks with potential equity partners to progress its plans to build a milk-processing plant at McNab, near Gore, Singapore-based chairman Alan King was initially keen to clear the air of speculation as he claimed no involvement with Natural Dairy.

More recent speculation has MVM remaining silent on the identity of any interested parties in its bid to raise capital.

A recent "tidy up" of MVM shareholders and a company restructure resulted in Southland businessman and multiple companies' director Ian Tulloch becoming the largest shareholder.

Other shareholders had been unpackaged from a group shareholding into individual shareholdings with overseas investment including shareholders from Singapore, Denmark, and the UK. The company directors are Ian Tulloch and Singapore-based shareholder Alan King.

King confirmed Natural Dairy met MVM interim chief executive Paul Johnstone and major shareholder Ian Tulloch "a few weeks back".

"We are not interested in them (Natural Dairy) and I have no idea what their objective is," King says.

In a follow-up interview with Country-Wide (May 10) Johnstone would neither confirm nor deny any discussions between MVM and Natural Dairy: "There is no secret that we are talking with a number of interested parties and I am not prepared to comment who any of those interested parties are."

With the land in hand and consents in place, MVM is seeking opportunities with comparable parties to move the project forward. "We are not discounting talking to anybody. I am not saying we are talking to them (Natural Dairy) but I am not saying we aren't," Johnstone says.

An Invercargill-based consultant is believed to be appraising southern farms for Natural Dairy in an exercise aimed at identifying opportunity in the region when Natural Dairy is ready to move to stage two. The three potential milk factory sites identified by Natural Dairy are the proposed site for MVM near Gore, Awarua and Makarewa.

Johnstone says the focus for Mataura Milk is looking for the right equity partner.

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