Harvard might axe Otago farms
Strong claims that Harvard University plans to sell its Otago dairy farms to another United States company have yet to be supported by consents filed with the Overseas Investment Office (OIO).
The Wall Street Journal has reported Harvard University is planning to sell its almost 3500 hectares of dairy farms and 5500 dairy cows in Otago. The Journal also reported that US privateequity company KKR & Co was nearing a deal to buy the holdings for more than $70 million, pending regulatory approval.
However, the sale is not as imminent as it seems.
An OIO spokeswoman said the office had not received an application for consent from KKR to acquire dairy farms owned by Harvard University.
A KKR & Co spokeswoman said the company was ‘‘constantly looking at opportunities across the region’’ but declined to comment any further, stating they ‘‘did not comment on media speculation’’.
Harvard initially bought the land and dairy assets of Big Sky Dairy Farms in 2010 in a liquidation sale and paid more than $28m for the Maniototo property. The company expanded their dairy operation in Otago last year, buying a further neighbouring block of 143ha for $1.3m.
The Harvard Management Company is a non-profit organisation which manages the world’s largest education endowment fund measured in 2015 at US$37.6 billion.
It has invested extensively in New Zealand forestry as well as dairy, buying 162,000ha of Kaingaroa forestry estate in 2003. Harvard later sold a third of its holding to the NZ Superfund.
Harvard Management Company declined to comment.
The holding company for Harvard’s dairy operations, DF1, reported a loss of $4.5m on revenue of $12m for the year to June 30 last year, an improvement on the previous year’s loss of $15.6m, on operating revenue of $5.3m.