PSP Investments, a pension fund, has bought 24.9% of Dairy Holdings from a group of exiting NZ owners including former Cabinet Minister John Luxton.
The existing DH cornerstone shareholders, Colin and Dale Armer and Murray and Margaret Turley, are increasing their shareholdings to 42% and 33% respectively.
DH chief executive Colin Glass said the management and staff have taken encouragement from the Canadian buy-in and it will be very much business as usual for the 75 farms in the group.
PSP was welcomed as a long-term shareholder that shares the company’s vision and strategy, Glass said.
PSP subsidiary Sooke Investments will appoint a director but has not done so yet, given the covid-19 disruption to international travel.
It is possible that person will have some dairying background.
DH has an annual turnover close to $100 million and assets worth about $1 billion including 55,000 milking cows, producing 16m kilos of milksolids.
It is the largest single-entity Fonterra milk supplier.
Milk production is expected to steadily increase by a small amount with irrigation upgrades.
“As regards payout this season, we prepare for the worst and hope for better,” he said.
“Market prospects look more encouraging in the month since Fonterra made its first milk price estimate.”
PSP already has primary sector interests in NZ – forestry giant Kaingaroa Timberlands and investment vehicle Global Herd.
It did not have to seek Overseas Investment Office approval for the DH buy-in because the stake is less than 25%.
