Amid rumours that Chinese investors were poised to buy the land, the minister has used existing powers to rule that to sell the estate to a foreign investor would not be in Australia’s national interest.
The landowner has put 11 million hectares (111,000sq km) of land up for sale, including working units in Western Australia, Queensland and the Northern Territory. It includes the earth’s largest working cattle ranch in the world, Anna Creek Station, in South Australia.
This deal is now on hold, with Morrison stressing that the size and location of the Kidman properties meant that selling them to a foreign investor would be contrary to Australian interests. "The parcel of land we are talking about, which is affected by these interests, is 1.3% of Australia’s land mass, 2.5% of the agricultural land in this country," he said.
Foreign sale not in 'national interest'
Notably, he stressed, "It is adjacent, in one of those significant parcels - the largest single parcel within that group - to the Woomera Prohibited Area," which is used by the Australian army to test new military weapons.
Talks will now be held between Kidman and the Australian government, which will have to agree whether the property can only be sold to an Australian buyer or split into smaller land parcels to allow multiple Australian and international owners.
While negotiations with bidders have been kept secret by the Kidman family, who own S Kidman, as well as the deal’s facilitators, Ernst & Young in Adelaide, according to national broadcaster ABC eight bidders have been shortlisted.
China in $252m 'bidding war'
The problem for Australia’s federal government is that this includes both Australian and international buyers. The Australian Financial Review (AFR) has claimed that Chinese investment firm Genius Link Group has been in an Australian dollars AU$350m (US$252m)-plus bidding war with Chinese rival Shanghai Pengxin.
Genius Link’s founder Joel Chang told the AFR that his company had AU$1 billion (US$720m) that they wanted to deploy in Australia over the next three years. “We see Australia as the food hub for the Asia-Pacific region,” he said.
Kidman & Co has acknowledged the government’s concerns in a public statement and said it will seek to clarify its worries and the deal’s parameters, so interested parties "can continue to work with the government in good faith to reach a satisfactory outcome".
Seeking to underline his government’s flexibility, Morrison stressed at a press conference: "The Australian government welcomes foreign investment to Australia. It has been a key part of this country’s development ever since the ‘first fleet’ [of initial European settlers] arrived."
Land of the 'cattle king'
Anna Creek Station alone, which encompasses almost 24,000sq km, is more than half the size of Switzerland. About half of the station’s pastoral lease is located next to and partly within the Woomera Prohibited Area (WPA) in South Australia.
The land has belonged to descendants of Australia’s legendary ‘cattle king’ Sir Sidney Kidman, who died in 1935, for five generations since 1899.
Members of the Kidman family own 98% of the shares in the unlisted public S Kidman & Co. They are selling all 10 cattle stations, including about 185,000 cattle as well as a bull breeding stud farm and a feedlot that belongs to the landholding.
The company is headquartered in Adelaide, and produces an average 15,000 tonnes of carcase beef each year, supplying 1.3% of Australia’s boxed beef exports.