Expansion plans are on the horizon again for Bindaree Beef after Hong Kong’s wealthy Hui family this week bought a 51 per cent stake in the northern NSW group in partnership with Beijing-based equity fund, Archstone Investment.
The McDonald family’s Bindaree Beef Group (BBG) is Australia’s fourth largest beef processor, which owns the Inverell abattoir in North West NSW and North Star’s “Myola” feedlot.
Bindaree, which began as a farming operation 60 years ago, has processing capacity to handle at least 300,000 cattle a year.
It has export offices in the US and China and marketing and distribution facilities in Sydney and Melbourne through its Sanger Australia division.
The Sanger export and domestic meat business, also active in Middle East and European markets, merged with Bindaree two years ago.
Last year the McDonald family’s plans for a 45pc sale of its BBG business to a mainland Chinese pork processor and retailer fell through having been initially flagged in late 2015.
The consortium has a successful investment track record and has plans to continue their investment in the upstream supply side of the beef industry
BBG founder, John (JR) McDonald, said the new partnership would provide capital needed to grow Bindaree’s current operations and support its strategy of supplying premium branded beef products to global and domestic markets.
The Chinese investors already have beef property interests in Western Australia, but are largely involved in the real estate and hotel development market in Asia and Australia.
The Hui family controls the Hong Kong Stock Exchange- and Shanghai Stock Exchange-listed Shimao Group.
Archstone has investments in food, agriculture, technology and medical businesses.
A statement from the overseas consortium noted the new partners had been attracted to Bindaree’s established supply chain and the opportunity to further develop the longstanding family enterprise.
“Demand for beef in South East Asia and China over the next 15 years is significant and the new joint venture has the combined expertise to leverage this opportunity,” the partnership said.
Regulatory approvals by the Foreign Investment Review Board have given the deal the green light allowing settlement to be finalised on Thursday.
The value of investment consortium’s share has not been disclosed, however the previous unsuccessful joint venture deal for 45pc of the big processing and marketing business was reportedly worth about $140 million.
Rapid expansion plan
“After lengthy discussions, we are delighted to have the right partner in place,” Mr McDonald said.
“Our joint vision for BBG is to create a more competitive company that can cater for both local and international markets.
“We will rapidly expand our reach while also upgrading our facilities, supply chain and distribution.
“The consortium has a successful investment track record and has plans to continue their investment in the upstream supply side of the beef industry in Australia.
“We are very confident in their commitment to the growth of the Bindaree business.”
Under the collaborative partnership, BBG’s management team, led by chief executive officer, Andrew McDonald, will continue running all aspects of the company with the new partners contributing to the setting of strategy.
Bindaree Beef Group employs more than 800staff.
Who are the investors?
• The Hui family-controlled Shimao Group.
One of the leaders in the property development industry in China. Its Shimao Property Holdings has a leading stake in 140 residential, hotel and commercial projects in 48 Asian and Australian cities.
Company principal, Chinese-Australian Hui Wing Mau, is reputedly Australia’s eighth richest person worth $5.9 billion (source: Australian Financial Review Rich List).
• Archstone Investment Company.
A diversified investment group with interests across the food, agriculture, technology and medical fields. Archstone is based in Beijing with investments in mainland China, Hong Kong and Australia.
Archstone expects to continue exploring agricultural opportunities in Australia, working with South Australian advisory and farm services group Australian Standard Agriculture.