Overseas investment decision for case 200520053 - Holcim (New Zealand) Limited

To acquire:

an interest in land which, either alone or together with any associated land exceeds five hectares in area.
an interest in land which, either alone or together with any associated land, that exceeds 0.4 hectares which is deemed a heritage or historic area.

The application has been approved as it met the criteria.

The Overseas Investment Office is satisfied that the Applicant has significant business experience and acumen relevant to and is demonstrating financial commitment towards the investment. The Overseas Investment Office is further satisfied that the persons who exercise control over the Applicant are of good character and not the kind of persons referred to in section 7(1) of the Immigration Act 1987.

The Applicant, through its operating divisions and subsidiaries, is involved in the manufacture, distribution and sale of cement and ready mixed concrete, and the extraction, processing and sale of aggregate and limestone. It has operated in New Zealand for over 115 years and has established positions within these markets.  The Applicant previously operated in New Zealand as Milburn New Zealand Limited.  The Applicant's parent company, Holcim Limited, is one of the world's leading suppliers of cement, aggregates and concrete.

The Applicant having previously entered into a Quarrying Deed with the land-owner is proposing to acquire an interest in the subject land being a profit a prendre to quarry aggregate resources on the land.

The Applicant and Wharehine Contractors Limited (Wharehine) (a New Zealand owned company) are forming a joint venture company Millbrook Quarries Limited (Millbrook) with the shareholding held by the Applicant as to 50.1 percent of the shares and Wharehine as to 49.9 percent of the shares.

Millbrook is to be granted a licence by Holcim to enable it to quarry stone, metal and rock on the land.  The licence will grant to Millbrook the majority of the Applicant's rights and obligations under the Quarrying Deed and the profit a prendre. Millbrook is also to be granted a licence by Wharehine to enable it to quarry aggregates on approximately 65 hectares of adjoining land (known as Whangaripo quarry), following Wharehine being granted a profit a prendre over this adjoining land. The licences do not require consent under the Overseas Investment legislation as they do not amount to an estate or interest in land.

The establishment of Millbrook as part of as joint venture between the Applicant and Wharehine will enable both companies to more efficiently utilise the resources on the land. Essentially, the joint venture will enable the existing quarry on the adjoining land to be extended up to and beyond the existing boundaries of that land, and into the resources on the subject land.

In terms of a Quarry Management Plan, the Applicant/Millbrook will be required to restore the subject land to pastoral farm land following completion of the quarrying operation.

The proposal is likely to result in the following benefits:

1. the retention of existing employment opportunities;
2. the introduction of development capital; and
3. enhanced domestic services to the construction industry.