Decision number200620007
Application number200610112
Date18 July 2006
Offeror/applicantLandmark Rural Holdings Limited (Landmark) of Australia
Ultimate applicant beneficial ownership100 percent - Australia
Beneficial overseas ownership 
- Asset currentN/A
- Asset proposedN/A
- Share current0 percent
- Share proposed50 percent
Offeree(s)/seller(s)Fonterra Enterprises Limited
100 percent - New Zealand, New Zealand Public
Business activitiesWholesale & Retail Trade - Basic Material
Details of land involved0.6552 hectares of freehold situated at 25 Stafford Street, Shannon being CT WN18B/9 (Wellington Registry).
0.8669 hectares of leasehold situated at 12 Oteha Valley Road, Albany, Auckland being CT NA50D/802 (North Auckland Registry).
Regions involvedAuckland
Manawatu
Total consideration$36,886,925
Consent SoughtTo acquire up to 50 percent of the shares of RD1 Limited.
Rationale

The application has been approved as it met the criteria.

Landmark is a wholly owned subsidiary of the AWB Investments Limited, which in turn is owned by Australian Wheat Board (AWB). Landmark was registered as a proprietary company in Western Australia on 24 July 1969. The company is Australia's largest supplier of agribusiness products and services. It operates from 430 outlets located throughout Australia, 230 being company owned, the balance being owned and operated by franchisees, agents and affiliate members. Landmark provides primary producers with a complete range of business services and inputs - rural merchandise and fertiliser, agronomy services, livestock and wool marketing services, insurance, real estate marketing services and financial products.

RD1 is a wholly owned subsidiary company of Fonterra, which carries out its rural service business through a national network of 51 stores located in dairy regions predominantly in the North Island.

Landmark and Fonterra intend to establish a joint venture in both New Zealand and Australia. Landmark sees the proposed investment as an attractive opportunity to expand the business of Landmark in the New Zealand agricultural market, a market closely aligned with Landmark's activities in Australia.

Landmark is a wholly owned subsidiary of the AWB Investments Limited, which in turn is owned by Australian Wheat Board (AWB). Landmark was registered as a proprietary company in Western Australia on 24 July 1969. The company is Australia's largest supplier of agribusiness products and services. It operates from 430 outlets located throughout Australia, 230 being company owned, the balance being owned and operated by franchisees, agents and affiliate members. Landmark provides primary producers with a complete range of business services and inputs - rural merchandise and fertiliser, agronomy services, livestock and wool marketing services, insurance, real estate marketing services and financial products.

Landmark views RD1 as being the leading company within its market segment in New Zealand and a profitable investment in its own right. Given the similarities of the Landmark businesses and the RD1 business, its investment in RD1 provides greater geographical diversification to its earnings base. Landmark and RD1 management have identified a number of growth opportunities to grow the RD1 business by, amongst other possibilities:

  1. the development of a range of financing products for RD1 customers leveraging Landmark's existing capabilities within Australia; and
  2. leveraging Landmark's existing procurement capabilities and scale where applicable to provide an expanded offering to RD1 customers.

In Australia, Landmark and Fonterra will form a Dairy Alliance (Australian Dairy Alliance). The Australian Dairy Alliance will build Fonterra's brand awareness within the Australian market and support Fonterra's growth aspirations.

ContactGarry Downs
Bell Gully
PO Box 4199
Auckland