Collapse of $125 Million Mega Dairy Operation Leaves Major Debts and Liquidation
Source: DairyNews.today
What was once a $125 million mega dairy enterprise has now collapsed, leaving millions in unpaid debts and its assets in liquidation. Five years ago, the acquisition of a portfolio of farms spanning 3,500 hectares across both the North and South Islands of New Zealand was heralded with great fanfare.
The farms were said to milk 10,000 cows, producing over 4 million kilograms of milk annually, making Waitonui Milltrust Agricultural Holdings (WMAH) one of the largest suppliers to Fonterra, New Zealand’s top dairy processor.
At the time, the international asset management company responsible for the operation boasted about its "carefully curated and diversified portfolio of cash-flow positive and environmentally responsible farms." However, the reality has turned out differently, with the Waitonui Group, which managed these farms, falling into liquidation by order of the High Court last month following an application from Inland Revenue.
The group, which operated dairy farming operations in Taupō and Oamaru, as well as holding assets related to those operations, was found to owe $36.5 million to the Bank of New Zealand (BNZ). This was the outstanding portion of a larger debt of $63 million that had been due in May 2022. After partial repayments and a debt mediation agreement in October 2022, the Waitonui Group was unable to repay the remaining debt, leading to BNZ’s demand for full repayment in April 2023. The debt still stood at $33.4 million, with receivers being appointed on the same day.
As part of the liquidation process, it was revealed that at least $12.3 million in debt remained unpaid, despite further recoveries during receivership. Additionally, two North Otago farms, the 550-hectare Burnside Dairy Farm and the 598-hectare Enfield Farm, have been sold in recent months.
The liquidation order was seen as necessary to protect the remaining assets of the company, with the court determining that the companies were unable to pay their debts. According to an initial receiver’s report, the group's cash flow had been severely impacted by rising farm costs, contributing to its downfall.
Milltrust International Group, the original manager of the Waitonui Group, issued a statement distancing itself from the New Zealand operation, stating that it had exited the venture in November 2021 as part of a strategic move to refocus its investments on sustainable growth worldwide. The group retained the Milltrust name but transferred management and control of the entities to new ownership after the 2021 transaction.
At the time, the international asset management company responsible for the operation boasted about its "carefully curated and diversified portfolio of cash-flow positive and environmentally responsible farms." However, the reality has turned out differently, with the Waitonui Group, which managed these farms, falling into liquidation by order of the High Court last month following an application from Inland Revenue.
The group, which operated dairy farming operations in Taupō and Oamaru, as well as holding assets related to those operations, was found to owe $36.5 million to the Bank of New Zealand (BNZ). This was the outstanding portion of a larger debt of $63 million that had been due in May 2022. After partial repayments and a debt mediation agreement in October 2022, the Waitonui Group was unable to repay the remaining debt, leading to BNZ’s demand for full repayment in April 2023. The debt still stood at $33.4 million, with receivers being appointed on the same day.
As part of the liquidation process, it was revealed that at least $12.3 million in debt remained unpaid, despite further recoveries during receivership. Additionally, two North Otago farms, the 550-hectare Burnside Dairy Farm and the 598-hectare Enfield Farm, have been sold in recent months.
The liquidation order was seen as necessary to protect the remaining assets of the company, with the court determining that the companies were unable to pay their debts. According to an initial receiver’s report, the group's cash flow had been severely impacted by rising farm costs, contributing to its downfall.
Milltrust International Group, the original manager of the Waitonui Group, issued a statement distancing itself from the New Zealand operation, stating that it had exited the venture in November 2021 as part of a strategic move to refocus its investments on sustainable growth worldwide. The group retained the Milltrust name but transferred management and control of the entities to new ownership after the 2021 transaction.
23.09.2024
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