Decision Summaries - November 2018

The Overseas Investment Office has released the following decisions for this month.

Schedule of deletions in terms of section 17 of the Official Information Act 1982 and under the provisions of sections 9(2)(a) and/or 9(2)(b)(ii) and/or 9(2)(ba)(i) of that Act.

Case No.

201810210

Statistical information on Overseas Investment Office decisions for 2018 Year to Date

The following statistical information shows consents granted or declined by the Overseas Investment Office for the sale of sensitive New Zealand land and significant business assets to overseas persons.  It does not necessarily indicate that a sale has taken place or will take place. 

Value of investments to New Zealand

The table below shows the net dollar investment value to New Zealand and gross value of consideration of consents granted to overseas persons for the 2018 calendar year to date and for the same time period in the preceding year. 

 January - November  2018January - November 2017
Number of approvals8283
Net investment $2,894,229,7562,101,165,094
Gross value of consideration10,148,422,1676,917,352,015

Asset value

2,252,242,0002,741,596,000

In terms of net investment, the three largest approvals by the Overseas Investment Office in 2018 to date, that can be disclosed were for:

  • Lee Bell Inc’s proposed acquisition of up to 100% of the shares of Icebreaker Holdings Limited – a “net” investment of $272,131,200; and
  • Waste Management NZ Limited’s proposed acquisition of a leasehold interest in 5.2452 hectares of land situated at 11 Springs Road, East Tamaki, Auckland – a “net” investment of $254,734,992; and
  • InterOperability Bidco, Inc. and Healthier Populations Holdco Limited’s proposed acquisition of 100% InterOperability’s business and assets and 24.9% of the Healthier Populations business of Orion Health Group Limited – a “net” investment of $206,820,000.

Total land area approved for sale to overseas persons  

The tables below show the net area of land (in hectares) for which consent was granted to overseas persons for the 2018 calendar year to date and for the same time period in the preceding year. 

Freehold land approved for sale

 January - November  2018January - November 2017
Number of approvals4250
Net land area (ha)[1]9,99116,825

In terms of “net” freehold land areas, the three largest approvals by the Overseas Investment Office in 2018 to date that can be disclosed was for:

  • ANZFF2 NZ Limited and the Trust Company Limited (as Trustee of ANZFIF2) proposed acquisition of a “net” land area of 3,062.6512 hectares of freehold land in the Wairarapa; and
  • Te Hau Station Limited’s proposed acquisition of a “net” land area of 1,667.0525 hectares of freehold land situated at Waipaoa Station, Gisborne; and
  • Summit Forests New Zealand Limited’s proposed acquisition of a “net” land area of 1,240.6131 hectares of freehold land situated near Whanganui.

Other interests in land approved for sale (for example leases and crown pastoral leases)

 January - November  2018January - November  2017
Number of approvals1418
Net land area (ha)[2]39,57911,819

In terms of “net” other interest land areas, the three largest approvals by the Overseas Investment Office in 2018 to date that can be disclosed was for:

Southern Ranges Limited’s proposed acquisition of a “net” land area of 39,336.8818 hectares of Crown Pastoral Lease land at 2514 Mt White Road, Bealey, Canterbury; and

  • Dairy Farms NZ Limited’s proposed acquisition of a “net” land area of 149.6131 hectares of leasehold land situated at Waipuna Road, Lowcliffe, Ashburton; and
  • Fenglin Wood Industry (New Zealand) Co., Limited’s proposed acquisition of a “net” land area of 31.7376 hectares of leasehold land situated at State Highway 34, Kawerau.

Summary of Approved Investments by Country[3]

In terms of net investment the table below shows the top 5 countries involved in approvals by the OIO for the 2018 calendar year to date that can be disclosed.

CountryNet Investment $
United States1,029,944,712
Philippines436,000,000
Canada309,904,298
Hong Kong272,004,912
Switzerland261,231,312

In terms of net freehold land area the table below shows the top 5 countries involved in approvals by the OIO for the 2018 calendar year to date that can be disclosed.

CountryNet Freehold Land Area (ha)
Luxembourg19,646
Germany8,729
Netherland7,814
Switzerland1,623
Japan1,576

Applications declined

The table below shows investments for which consent was declined for the 2018 calendar year to date and for the same time period in the preceding year.

 January - November  2018January - November 2017
Number of declines20
Total proposed area to be acquired (ha)2630

The low level of applications declined is due to the following factors:

  • Applicants seek professional advice, and engage with the OIO, before submitting an application for consent.  They do not normally submit applications, and incur the associated costs, if they are unlikely to meet the criteria and factors test in the legislation. 
  • The OIO’s pre-acceptance quality assurance check results in around 25 percent of applications being rejected at the outset. 
  • The OIO advises applicants if it intends to decline (or recommend decline) their application. Applicants often withdraw their application rather than have it declined. 

These processes shows the rigor of the assessment process but is not reflected in the application declined figures. 

For more information contact:

Overseas Investment Office
Land Information New Zealand
Ph:  04 462 4490
oio@linz.govt.nz

Terms and Definitions

Net investment dollars

“Net investment dollars” represent the total dollar value invested in New Zealand. For example, if a New Zealander sells a $100 million business to an Australian then the whole $100 million is added to the net investment total. However, if for instance the New Zealand asset was 100% Japanese owned, then $0 would be added to the net investment total. Thus, the net change in ownership of New Zealand assets is captured in the "total" net investment figure.

Gross value of consideration

“Gross value of consideration” represents the total consideration including GST (if any) to be paid for the acquisition of the assets, or the value attributed to those assets, under consents granted during the relevant period.  The “gross value of consideration” figure for November includes consideration paid by New Zealanders (for example, an acquisition of a business by a New Zealand/Australian joint venture), and will not reflect the net change in ownership of New Zealand assets.

Consideration

The reference to “consideration” refers to the amount proposed to be paid for the acquisition by the purchaser.

Asset value

“Asset value” refers to the value of assets of the person being acquired (or the person being acquired and its 25% or more subsidiaries).

Net hectares

"Net hectares" represents the total land area proposed to be transferred into foreign ownership under consents granted during the relevant period.  For example, if a New Zealander sells 10 hectares to someone from overseas, the whole 10 hectares is shown.  However, if the seller was a company that was 50% New Zealand owned and 50% foreign owned then only five hectares would show in that column. Five hectares represents the "net" change in foreign ownership of New Zealand land.

Gross hectares

“Gross hectares” represents the total land area proposed to be acquired under consents granted during the relevant period.  The figure will include land that is proposed to be acquired by New Zealand interests as well as overseas interests (for example, under a New Zealand/Australian joint venture).
 

[1] The Gross land area was 137,281 ha in 2018 and  21345 ha in 2017
[2] The Gross land area was 44,934  ha in 2018 and 12,756  ha in 2017
[3] The country “Net Investment $” and “Net Freehold Land Area”(refer next page) figures represent the total dollar value invested in New Zealand and the net land area being acquired by that country during the reporting period.  For example a Japanese entity acquiring 1,000 ha for $1 million from an Australian company would result in $1 million and 1,000 ha being added to Japan’s “Net Investment $” and “Net Freehold Land Area” totals and $1 million and 1,000 ha being deducted from Australia’s totals.