CPC property selldown continues, with Ucharonidge divestment
by Jon Condon
THE gradual sell-down of northern grazing assets has continued this week for Terra Firma’s Consolidated Pastoral Co, with a deal announced today to sell the company’s Ucharonidge station in the Northern Territory to Malcolm Harris’s Cleveland Agriculture.
Ucharonidge is one of CPC’s smaller NT breeding properties, covering 245,550ha of country immediately to the east of Newcastle Waters. The property has a carrying capacity of 19,870 head and was sold on a walk-in, walk-out basis. A price around $30 million has been suggested.
The sale brings the value of CPC properties offloaded individually or in small groups over the past 12 months to close to $300 million (see details below). If the earlier August 2016 sale of Carlton Hill is added, CPC’s sale proceeds figure rises to closer to $400 million.
Under CPC’s ownership Ucharonidge has been used to provide grower cattle to Nockatunga Station in Queensland’s Channel Country. Nockatunga, itself, was sold separately to Mr Harris’s Cleveland Agriculture in October last year.
CPC purchased Ucharonidge in 2008 from territory cattle pioneers, the Beebe family.
Bought for its similarity to, and location beside CPC’s Newcastle Waters, Ucharonidge has been used as a breeder block with seasonal opportunistic fattening. Predominantly open down country, it also has a mix of bluebush swamps in the south and scattered areas of spinifex and lancewood.
CPC chief executive Troy Setter said Cleveland was a logical owner of Ucharonidge, given its recent purchase of Nockatunga, for which Ucharonidge has historically provided grower cattle.
“Ucharonidge is a good strategic fit for the Cleveland Agriculture business and importantly, Malcolm Harris and his team share our vision for investment in land development and precision pastoral management,” Mr Setter said.
Despite its sequence of recent sales as part of owner, Terra Firma’s stated aim to sell the business (see below), CPC remains one of the largest pastoral owners in northern Australia, holding 3.5 million hectares of land across nine stations with a carrying capacity of some 300,000 head of cattle.
The company also majority owns two feedlots in Indonesia with nearly 30,000 head of capacity.
“Our portfolio has strong geographic diversity as well as a valuable supply chain in Indonesia and remains attractive to buyers as a whole or in parts,” Mr Setter said.
Purchase builds capacity for Cleveland Ag
New owner, Mungindi-based Malcolm Harris and family’s Cleveland Agriculture operates large-scale irrigated and dryland cropping and grazing operations across four states and territories.
As stated above, in October, Cleveland Ag bought CPC’s prized large-scale channel country bullock fattening depot Nockatunga Station. Widely regarded as one of the state’s best bullock depots, 852,000ha Nockatunga is located in Queensland’s far southwest corner, 125km west of Thargomindah. Speculation suggested a price as high as $50 million, including 5000 head of cattle and station plant.
In 2016 the Harris family bought Benmara Station on the NT’s Barkly Tablelands, a 450,000ha property with an estimated carrying capacity of 20,000 cattle. A price of $12 million was suggested at the time. Benmara was added to the Harris family’s existing NT holdings, 5000sq km Rockhampton Downs on the Barkly east of Tennant Creek, and Gogo Station in the Kimberley region of Western Australia.
In 2016 the Harris family joined prominent privateer northern beef producers Stirling Buntine, Tom Brinkworth and Viv Oldfield to mount a $386 million bid for S. Kidman & Co, ultimately losing-out to Gina Rinehart’s consortium involving a Chinese minor shareholding.
CPC’s property sales history to date:
May 2019: Manbulloo Station 379,130ha near Katherine (sale and leaseback deal with around $25 million)
April 2019: Comely/Mapala Stations, 23,000ha near Moura Central Qld, bought for around $50m bare by Sterling Buntine’s Baldy Bay Pty Ltd
March 2019: Mimong Station, about 80,000ha near Kynuna in Northwest Queensland, bought for around $20 million bare, also by NT pastoral identity Sterling Buntine.
January 2019: Auvergne and Newry Stations, 740,000ha in the Victoria River District on the western side of the NT, and Argyle Downs station just across the border in the East Kimberly region of WA to Vietnam-based investment group Clean Agriculture & International Tourism. Unconfirmed reports suggest a price around $135 million.
October 2018: Nockatunga Station, 852,000ha in Queensland’s Channel Country bought by Malcolm Harris and family’s Cleveland Agriculture. Speculation suggested a price as high as $50 million, including 5000 head of cattle and station plant.
August 2016: Although somewhat distanced from the current company divestment process, CPC in 2016 announced a $100 million sale of Carlton Hill station in WA’s Ord River district. Carlton Hill buyer, Chinese company Shanghai Zhongfu was earlier awarded the land, water and development rights for the Ord Irrigation Area stage two, for the next 50 years. Under the agreement, CPC has leased back most of the 476,000ha of country on Carlton Hill for the next ten years, while an area of about 14,000ha will be developed by the new owner for irrigated cropping. The Carlton Hill deal was understood to be worth $70 million bare, plus a value of $30 million attributed to CPC’s ten-year leaseback agreement on the remainder of the property – giving a total transaction value of $100m. No cattle changed hands under the Carlton Hill agreement.