24 Jan 2012

NZ consortium takes legal action over Crafar farms

6:25 pm on 24 January 2012

A consortium trying to buy the Crafar farms against competition from a Chinese buyer has taken legal action.

The Crafar Farms Purchase Group includes iwi and farming interests and is headed by businessman Sir Michael Fay.

On Tuesday morning, it filed a writ in the High Court and will begin proceedings on Thursday.

The consortium is seeking disclosure of recommendations by the Overseas Investment Office to government ministers regarding a Chinese bid for the 16 North Island farms in receivership.

Receivers KordaMentha have set a deadline until the end of January for the Shanghai Pengxin Group to go unconditional with its $200 million-plus bid.

KordaMentha have rejected the Crafar Farms Purchase Group's $171.5 million bid for the farms.

The consortium is seeking a judicial review of the Overseas Investment Office's recommendations, saying the process is not transparent.

The consortium believes its bid is in danger of being scuttled if the Government makes a decision in favour of the sale to Shanghai Pengxin Group without the reasons being disclosed.