Newcomers add diversity to Rich List for 2017
THE National Business Review 2017 Rich List is showing signs of a diversification of the economy and some newcomers are making their presence felt.
In Otago, the familiar names remain and Michael Guthrie, the largest shareholder in Mainland Poultry makes the list for the first time.
Peter Thiel, who received New Zealand citizenship in controversial circumstances, makes the list, worth $3.7 billion.
However, Graeme Hart remains the country’s richest individual, adding $500 million this year on an improved outlook for the packaging sector.
Property kings Sir Michael Friedlander and Sir Robert Jones had big increases in wealth, as did the Hurst Family, from North Otago, with its retirement villages.
Only 20 members were marked down, led by expatriate Richard Chandler, whose wealth was cut in half to $2 billion.
Southern standouts are. —
Michael Guthrie
$200 million
As the largest shareholder in Mainland Poultry, Michael Guthrie’s 76.6% stake in the business was theoretically worth about $A300 million ($NZ319 million) based on speculation in the Australian business media that the business could sell for $A400 million — a figure Mr Guthrie said was an exaggeration.
Having cofounded Mainland Poultry with Murray Valentine in 1997, Mr Guthrie has created a business that has a laying flock of more than one million hens. Using the Woodland and Farmer Brown labels, the eggs are sold by Zeagold Foods, which has a third share of a domestic retail egg market worth $268 million. Zeagold also exports to the likes of Singapore and Hong Kong.
Vertical integration is a core company philosophy, so Mainland controls and manages every element of the egg pro duction process — from the rearing of dayold chicks to the production of feed and the packaging and processing of egg products.
MainFeeds is a wholly owned subsidiary that produces 140,000 tonnes of feed annually for sale throughout New Zealand and the Pacific. Originally known as the Poultrymen’s Cooperative Society Ltd (PCL), MainFeeds operates large mills at Wiri and Levin and sells a wide range of products for poultry as well as for pigs, rabbits and dogs.
Despite having one of the most modern poultry farms in the country near Waikouaiti, like most egg producers, Mainland is having to face up to the cost of phasing out and replacing battery cages by 2022 under a new code of welfare that has been estimated to involve capex of about $60 million.
Describing the phaseout time as ‘‘brutal’’, Mr Guthrie effectively put the business on the block in February 2017 when he retained ANZ Bank to advise on its options. Mr Guthrie also indicated that he and his fellow shareholders had in mind that they were not getting any younger and might be looking ‘‘to have a pathway to liquidity’’.
A swag of Australian private equity firms were apparently lining up bids when news broke in midMarch that the Serious Fraud Office was investigating claims that millions of caged eggs were being sold as free range by an Auckland wholesaler that also supplied Mainland Poultry.
A past president of the Egg Producers Association, Mr Guthrie said Mainland took a financial hit when it had to withdraw the affected product but the reputational damage to the industry was potentially much worse. ‘‘It is a huge betrayal but we’re the ones who are going to pay for it,’’ he said.
Apart from his poultry interests, Mr Guthrie owns a handful of commercial and residential properties in Dunedin and Wanaka and lives in a fairly modest home in Dunedin’s Andersons Bay.
Hurst Family
$105 million
The Hurst family has farmed in North Otago and South Canterbury for five generations.
But when brothers Doug and Ian Hurst met Geoff McPhail and Terry Pratley in 1982, a new business idea emerged.
In partnership they formed Hurst Lifecare, an agedcare business with facilities in the North and South islands.
Today, the portfolio includes the Strathallan Lifecare retirement village in Timaru, Oxford Court Lifecare in Dunedin, Rhodes on Cashmere in Christchurch, Mary Doyle Lifecare in Hawke’s Bay and Village At The Park in Wellington.
The brothers also have a shareholding in listed agedcare company Arvida, in which former All Blacks Richie McCaw and Dan Carter are also investors.
The rugby connection goes further, as Ian is also a former All Black, and his son Ben played for the Crusaders and the Highlanders in the early 2000s.
The Hursts have several investments at the other end of the care spectrum, through a bunch of Little Wonders Childcare centres in Oamaru, Timaru, Cromwell, Dunedin and Christchurch. Ben is a shareholder and director alongside his father and uncle.
He owns Little Wonders Management and is joint owner of the Auckland Little Wonders facility. Ian and daughter Sarah also own Penny Lane Childcare in Christchurch.
Doug and Ian have neighbouring farm properties on the GeorgetownPukeuri highway and Ian and Gloria live in a restored stone homestead that has been in the Hurst family since 1928. The brothers own about half of Oamaru’s North Otago Motors, as well as property in Cromwell.
Alistair Jeffery
$90 million
From his UK home in Cam bridge, expatriate Alistair Jeffery presides over an expanding multinational financial services business that has gradually spread its wings from Australia to the UK and now Ireland.
Founded by the Dunedinraised Mr Jeffery, the Bluestone Group employs more than 250 people, including a call centre team based in the Philippines. Bluestone Consolidated Holdings originates, manages and funds loan portfolios and, according to its latest annual report, it had a £388 million ($NZ677 million) portfolio in 2016 and reported a net profit of £3.5 million on net income of £24.9 million.
As executive chairman, Mr Jeffery said while funding markets had ‘‘remained somewhat subdued’’ in Europe, Bluestone still achieved important miles tones such as the start of UK mortgage origination and the securitisation of mortgage backed securities worth $A250 million in Australia, where it was voted the No 1 specialist lender by brokers in the Momentum Intelligence report.
Bluestone maintains a small New Zealand presence but Mr Jeffery’s main interest has been in the funding and development of the upmarket Bendemeer residential lifestyle project at Queenstown’s Lake Hayes. Comprising 110ha of rolling pastureland surrounded by 7km of rabbitproof fencing, more than 28 properties have been sold for about $25 million.
Educated at Otago and Auckland universities, 51yearold Mr Jeffery was an investment banker in London in the 1990s where he gained specialist experience in mortgagebacked securitisation before heading to Sydney where he founded Bluestone in 2000.
Aad and Wilma van Leeuwen
$60 million
New Zealand’s milk superpower status would not be nearly as impressive if it were not for the van Leeuwens’ enormous robotic milking operation in Makikihi, south of Timaru. The project is their third attempt at the technology, completed in September 2014, and counts as the largest in the world of its type at 23,000sq m and a cost of $22 million.
‘‘Land is getting more expensive, so 80% of the world’s dairying is done under cover now. New Zealand is an anomaly in that it’s still mainly pasturebased. The barn is increasingly being seen as a viable solution to cow comfort and environmental concerns,’’ Aad van Leeuwen said.
The barn and robot system allows for a flat milk curve and price premiums for winter milking. It also reduces the uncertainty of the human element in the operation, due to the sector’s skilled staff shortages. He believed the system offered optimal feed management, cow comfort and comprehensive herd information.
The two arrived in New Zealand from Holland in the early 1990s. The South Canterbury group has 12 holdings and 12,000 dairy cows with 24 Lely robots in three barns of 500 cows each.
The Van Leeuwens’ barn supplies Oceania Dairy, a dairy plant operating in South Canterbury. Oceania is a subsidiary of the Chinese owned Yili Industrial Group. Construction began at the Glenavy site in April 2013 and the first stage was opened in November 2014.
The Van Leeuwens were founding shareholders of Oceania Dairy business before its sale to Yili.