Simplot (Mr Chips) Holdings Pty Limited

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Decision Consent granted
Section 12(b) Overseas Investment Act 2005
Decision date 20 April 2011
Investment An overseas investment in sensitive land, being the Applicant's acquisition of rights or interests in the remaining 34.3% of the shares of Simplot Mr Chips Limited which owns or controls a freehold interest in 2.6174 hectares of land at 100 Kerwyn Avenue, East Tamaki, Auckland.
Consideration $24,393,817
Applicant Simplot (Mr Chips) Holdings Pty Limited
United States of America (100.0%)
Vendor Existing Shareholders of Simplot Mr Chips Limited other than Simplot (Mr Chips) Holdings Pty Limited
Balle Bros Group Limited, New Zealand (15%)
Angelsea Consulting Limited, New Zealand (10%)
Trevor Good & Jeanette Good, New Zealand (5%)
Sinclair Long Term Holdings Limited, New Zealand (3%)
Jon Davison, New Zealand (1.3%)
Background

The ultimate parent company of the Applicant is J.R. Simplot Company (JRS). JRS has extensive interests in potato processing, marketing distribution and sales. JRS is one of the world's largest frozen potato processors with production of more than 3 billion pounds of french fries and related products. The Applicant was and continues to be a supplier of potato products to JRS’s Australian operations.

Under a shareholders' agreement the New Zealand shareholders in Simplot Mr Chips Limited (Simplot) were granted various put options. Through the put options, the New Zealand Shareholders can require the Applicant to acquire the shares that each of them hold in Simplot.

The put options were granted to give the New Zealand shareholders an exit mechanism for their shareholdings and to ensure that the Applicant could acquire the Simplot shares and not have them sold to a person or persons whose interests are not aligned with its own. Bringing Simplot into the JRS Group as a wholly owned subsidiary will only strengthen the support and commitment that JRS has to Simplot.

The overseas investment transaction has satisfied the criteria in section 16 of the Overseas Investment Act 2005. The 'benefit to New Zealand' criterion was satisfied by particular reference to the following factors:

Overseas Investment Act 2005

  • 17(2)(a)(i) – Creation/Retention of jobs
  • 17(2)(a)(v) – Additional investment for development purposes

Overseas Investment Regulations 2005

  • 28(b) – Key person in a key industry
  • 28(c) – Affect image, trade or international relations-
  • 28(e) – Previous investments
More information Melissa Pengelly
Quigg Partners
PO Box 3035
WELLINGTON 6140

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