Overseas investment decision for case 201720014 - Craigmore Permanent Crop Limited Partnership

The Applicant 

The Applicant is a limited partnership established in 2016 as a horticulture investment vehicle, and is part of the wider Craigmore Farming Group which has made numerous investments in New Zealand.

The Applicant is 97.72% owned by overseas persons but effectively controlled by non-overseas persons. 

The Applicant partnered with a New Zealand owned and controlled a pack house and cool store operator for the purposes of the proposed investment. 

Investment 

The Applicant sought consent to acquire an operational green kiwifruit (5.96 ha) (Hayward) and avocado (2.04ha) orchard in Te Puke. 

A key feature of the Applicant’s investment plan is to convert all kiwifruit on the Land to organic production for supply to Zespri, including the conversion of some of the Hayward trees to the gold variety (G3). Organic kiwifruit attracts a premium and Zespri is seeking to increase its organic supply to meet demands overseas. 

The likely benefits proposed by the Applicant resulted primarily from the conversion to organic production and the conversion of some of the existing avocado trees (0.5 ha) to Hayward:

• jobs (around 1 FTE);
• some additional export receipts from the organic conversion;
• some additional investment for development purposes for upgrades on the Land largely related to the organic conversion;
• minor increase to New Zealand’s reliability as a supplier of organic G3 kiwifruit; and
• oversight and participation of New Zealanders (11.272% ownership by New Zealanders of the acquiring entity and a high level of New Zealand control over the relevant overseas person and investment).

Assessment

For consent to be granted, Ministers needed to be satisfied that the acquisition of the Land would benefit New Zealand and that the benefit would be substantial and identifiable. 

The overall assessment, having regard to the new rural land directive, was that the overseas investment was likely to benefit New Zealand but that the benefit was not substantial and identifiable within the context of the investment.