NAPCO looks at sale options

NAPCO looks at sale options


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NAPCO operates 13 cattle stations across Queensland and the Northern Territory covering 5.8 million hectares, as well as the Wainui Feedlot at Dalby on the Darling Downs.

NAPCO operates 13 cattle stations across Queensland and the Northern Territory covering 5.8 million hectares, as well as the Wainui Feedlot at Dalby on the Darling Downs.

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ONE of Australia's largest landholders and cattle producers, the North Australian Pastoral Company, has been offered for sale.

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ONE of Australia's largest landholders and cattle producers, the North Australian Pastoral Company, has been offered for sale.

NAPCO operates 13 cattle stations across Queensland and the Northern Territory covering 5.8 million hectares, as well as the Wainui feedlot on the Darling Downs in southern Queensland, reports The Australian Financial Review.

The $440 million company has been looking at its options with major shareholder – the London listed MP Evans – co-operating with the sale process.

The process is being run by Melbourne-based corporate advisory company Gresham Partners.

NAPCO and Gresham Partners' Colin Galbraith and Mark Stevens declined to comment.

The sale comes just as Australia's cattle producers face pressure from a strong Australian dollar, drought and an oversupply from a hamstrung live export market.

NAPCO recently reported a $5.68 million loss for the year to December 2012, down from an $11m profit the year prior.

Rumours have been circling that the London-based private equity firm Terra Firma, which is the majority owner of cattle producer Consolidated Pastoral, had looked at NAPCO last year with the intention of beefing up its property portfolio and herd numbers.

NAPCO, a private company with a respected reputation, reduced the holding value of its property portfolio in 2012. The result followed a combined $68m in total writedowns from Macquarie's Paraway

Pastoral and Australian Agricultural Company in the past two months.

NAPCO was established in 1877 with the purchase of Alexandria Station in the Northern Territory.

It generated $12.3 million in positive operating cash flow in 2012 up from $5.3m the previous year, largely due to a decrease in cattle purchases.

While NAPCO has recorded $306m in overall property plant and

equipment on its books as well as 197,000 cattle, market sources said it was difficult to value the company given the uncertainty around earnings.

When Consolidated Pastoral sold in 2009 for $425m the company's earnings before interest and tax were about $25m indicating a multiple of 17 times.

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