Overseas investment decision for case 200520075 - Milburn New Zealand Limited

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.

On 21 August 2001 the Applicant entered into a deed of lease of part (1706m2) of the land at 70 Patiki Road, Avondale, Auckland with Antares Holdings Limited. The land is utilised for concrete truck parking. The balance of the land is leased by Antares Holdings Limited to MT Containers for the manufacture of plastic containers.

The leased land adjoins a 6020m2 parcel of land owned by the Applicant, from which it operates a ready mix concrete plant. The existing land owned by the Applicant was part of the land the subject of A199820094/D199820095, when Zealhoff New Zealand Limited acquired the balance shareholding in the Applicant (then named Milburn New Zealand Limited) in 1998. The 6020m2 parcel of land is sensitive, being land that exceeds 0.2 hectares, and adjoins the foreshore (the Whau River).

The land leased by the Applicant is "associated land". The Applicant did not obtain consent to the entry into this lease as the issue of whether the leased land was associated with the existing land holding of the Applicant was not considered when the lease was entered into and was an inadvertent oversight by the Applicant and its solicitors. It was not until the Applicant exercised a first right of refusal under the lease to acquire the freehold, that this issue was identified. The Applicant has filed an application (refer A200520086) to acquire the freehold interest in the land.

The proposal resulted in an avenue for future greater productivity and efficiencies to the Applicant's existing ready mix concrete plant. The subsequent decision by the Applicant to exercise its first right of refusal under the lease to acquire the freehold of the property (refer Application No. 200520069) is likely to enhance these benefits.