Overseas investment decision for case 200820039 - Craigpine Timber Limited

The application has been approved as it met the criteria.

The Overseas Investment Office is satisfied that the individuals with control of the Applicant collectively have business experience and acumen relevant to the overseas investment, and that the Applicant has demonstrated financial commitment towards the overseas investment. The Overseas Investment Office is further satisfied that each individual that exercises control over the Applicant is of good character and is not an individual of the kind referred to in section 7(1) of the Immigration Act 1987.

Background to the Investment:
Craigpine Timber Limited (Craigpine) is a Southland based forestry company which owns approximately 3,523 hectares of land established primarily in radiata pine forestry in the Southland region. Craigpine operates a sawmill at Winton which processes the logs from the forest estates for both the domestic and the export markets. Craigpine is currently in the process of establishing a dairy farming operation on 252 hectares of land which was previously planted in pinus radiata. The 252 hectares formed part of Craigpine's 911 hectare Waitane Forest situated approximately 14 kilometres west of Mataura. Craigpine advise that stock have been placed on the land for the first time this current winter. The land will be used as a dairy support unit until the soil fertility of the land is increased to the levels required to support dairy farming. Craigpine anticipates a timeframe of two to five years.

Craigpine's rationale for establishing a dairy farming division is to diversify and to add value to Craigpine's operations. Craigpine advises that while it has no present plans to convert other forestry land for dairying or other uses, Craigpine has a policy of always considering "best land use" and will continue to seek opportunities to increase its forestry and farming estates.

Outline of the Investment:
Craigpine intends to purchase the land and forestry assets known as the Eyre Forest. Craigpine has already commenced work on the harvesting of the forest under a pay as cut timber sale agreement.

Rationale for the Investment:
Craigpine has dual purposes for acquiring the land. In relation to that part of the land which is suitable for return to pasture after completion of harvesting of the forest (110 hectares), Craigpine intends to establish a runoff block to support a dairying operation that is currently being established by Craigpine. The balance of the land used for forestry (99.5 hectares) will be re-planted for a further forest rotation.

The proposed overseas investment is or is likely to benefit New Zealand (or any part of it or group of New Zealanders) having regard to the following factors:

Overseas Investment Act 2005:
s17(2)(a)(i) - Creation/retention of jobs;
s17(2)(a)(v) - Additional investment for development purposes;
s17(2)(b) - Indigenous vegetation/fauna;
s17(2)(d) - Historic Heritage;
s17(2)(e) - Walking access.

Overseas Investment Regulations 2005:
r28(e) - Previous investments; and
r28(g) - Enhance the viability of other investments.