Federated Farmers is urging farmers to conduct strict due
diligence checks before signing sale contracts in the wake of
reports that a Maori trust claiming to have financial backing
from Dubai World has been contracted to buy 28 farms in
Southland for more than $150 million.
"It goes against every commercial norm for major capital
items to be sold on a 'no-deposit' basis, and farms are as
big a capital item as you can get," said David Rose,
Federated Farmers rural security spokesman.
The Green Party also expressed concern that the trust was
apparently negotiating with Dubai World - a subsidiary of the
Dubai Government - to buy New Zealand farms to gain control
of food supplies.
Large areas of New Zealand land would effectively be
controlled by a foreign government if the deal went ahead,
said Greens co-leader Russel Norman.
The benefits from selling the food would not kept within the
New Zealand economy, but would instead be passed on to
overseas interests.
Federated Farmers told its own farmers considering selling
that they could contact its lawyers to discuss the deals, and
suggested non-members take independent advice.
"I am extremely nervous of reports that no-deposits are being
taken," said Mr Rose. "It's pretty fundamental that a deposit
be exchanged as a tangible sign of good faith".
A second concern related to the financial backer: Dubai World
- the Emirates' owned and controlled corporate lender.
On November 27, the federation warned that Dubai World was
close to defaulting on a substantial part of its $US60
billion ($NZ82 billion) debt.
On Monday another Emirates state, Abu Dhabi, injected $US10
billion to save Dubai World from an immediate default.
"We are naturally concerned that the supposed backer may not
be prioritising the purchase of Southland farms," said Mr
Rose. "The fact that a reported deposit milestone has already
been missed is further cause for alarm.
"It is imperative farmers obtain independent counsel as well
as insisting on a deposit," Mr Rose said.
The Maori trust has contracted to buy nearly 30,000ha of
dairy, sheep, beef and deer farms throughout Southland, but
some sellers have raised queries ranging from delays
confirming the sales contracts to deposits not being paid as
expected.
Two of Southland's largest rural real estate companies, PGG
Wrightson and Southern Wide, declined to deal with the trust,
but the farms have been bought through other real estate
agents.
A spokesman for the purchasers, Wynn Murray, told the Otago
Daily Times the trust was a serious buyer.
It had financial backing, including from overseas, and sales
contracts would be made final in late February or early
March.
The delay was because of dairy farmers wanting to see out the
milking season and deposits would be paid when contracts were
finalised, he said.
Mr Murray, from Invercargill, declined to name the trust he
represented or confirm it was being funded from Dubai.
He did confirm that an option was for milk from the trust's
farms to be processed specifically for Dubai markets.
Mr Murray said the trust he represented was not aligned to a
tribe, but made up of a group of individual Maori people from
throughout New Zealand who had pooled their resources.
"We're just Maori people who have got together and decided,
'Let's do this'."
There was no Treaty of Waitangi settlement money involved.
He has been buying farms for the past three or four months
and, while he had been told to stop, expected to resume again
in the new year.
Mr Murray said farm managers and staff would keep their jobs
under the new ownership, and product would be supplied to
existing processors.
