SYDNEY • A Chinese-led consortium has withdrawn its A$371 million (S$381 million) bid for Australia's vast Kidman cattle empire after the government indicated the deal was not in the national interest, the seller said yesterday.
Australia's biggest private landholder S. Kidman and Co had selected the bid by Chinese-owned Dakang Australia Holdings and ASX-listed Australian Rural Capital (ARC) as the preferred buyer for most of its stations, with Dakang to take an 80 per cent interest, and ARC, 20 per cent.
But in a preliminary decision last week, Treasurer Scott Morrison said the offer was "contrary to the national interest", given the proposed size of the Chinese acquisition.
He gave the consortium until yesterday to respond, but Kidman's managing director Greg Campbell said such a tight time frame meant terminating the bid had been the only option.
"As a consequence of these discussions, Dakang Australia Holdings has withdrawn its current application to the Foreign Investment Review Board," Kidman said in a statement.
Mr Campbell said Kidman family shareholders were resistant to seeing the 120-year-old company broken up, a move he said would result in significant reduction in its value.
Kidman, which is currently 34 per cent foreign-owned, would also be seeking clarity from the Australian government about the level of foreign investment it deemed acceptable, Mr Campbell said. He added that the company would continue discussions with the consortium.
Kidman has attracted keen interest from Chinese firms wanting to secure the sprawling pastoral empire amid growing concerns about valuable agricultural and mineral assets passing into foreign hands.
More than 130 Australian parties had been approached as part of the initial sale process starting in April last year, according to Mr Campbell, but no final bids were received.
"Australian parties remain welcome to come forward and express interest in acquiring the business in its entirety," he said. "We also welcome interest from anywhere around the world, including the USA, Chile and New Zealand."