NZ Dairy Group Leads the Way in Western Australia

New Zealand Dairy Group Leads the Way in Western Australia

Lactanz is a pioneering dairy project in Western Australia working within the original consortium of Wairarapa Moana Incorporation (WMI) and joining up with Mawhera Incorporation from the Te Tai Poutini of the South Island and Paraninihi ki Waitotara Incorporation from Taranaki.

Management successfully gained shareholders approval to invest in Lactanz. Apart from being innovative and visionary the Committee of Management, after due diligence on the project, was impressed with the level of expertise and experience brought to the project. It was also a way of spreading the country risk with all of WMI’s dairy assets in New Zealand.

The scheme was originally viewed with some scepticism by Australian farmers who thought it could never be established but thanks to the vision, leadership, diligence and tenacity of John Young, retired chairman of Kiwi Dairies Ltd, Lactanz is the largest producer of milk in Western Australia that uses existing New Zealand technology and expertise. Currently, four share milking farms have been developed at the cost of $30 million on the Scott River coastal plain. The four farms are part of the company Lactanz, which is a family-based yet corporate-run farming business.

This is one of the first investments made with the Spencer whanau, one of New Zealand’s wealthiest families with connections to the historic Caxton Paper group. According to Te Horipo Karaitiana, a director of WMI, Maori should work strategically together with other inter-generational outlook families and high net worth individuals where Maori values are aligned.

He explains that as a development project the Committee of Management made it clear from the outset that dividends would be foregone for some time. However, with developments now completed the focus of Lactanz is now on driving productivity and profitability. He adds that WMI’s interest in the project is currently under review and as reported at the last AGM further funds have not been committed from the original $NZ1.2m. He suggests that although the funds represent only a small portion of the total asset base of WMI, a reasonable return should be made to shareholders.