PHOTO: FILE
A large dairy farming operation, the Waitonui Group, has collapsed owing over $36 million to its bank and is now in liquidation. The group managed extensive dairy enterprises across the central North Island and the South Island, grazing approximately 5,000 cattle on more than 2,000 hectares.
The High Court placed Waitonui Group into liquidation on August 12, following an application from the Inland Revenue. According to the liquidators’ report, the group has no realizable assets apart from cash held in the bank. Unsecured creditors are owed $37 million, with Inland Revenue (a preferential creditor) owed $68,597 and secured creditors owed $3.5 million.
Despite the financial turmoil, receivers, aided by farm management staff and contract milkers, have continued to operate the group’s farms. Two large farms, Burnside Dairy Farm (550 hectares) and Enfield Farm (598 hectares), both located in North Otago, have been sold in recent months.
The first receivers’ report indicated that the Bank of New Zealand (BNZ) was owed $36 million. The report highlighted that the cash flow for the four entities within the Waitonui Group was severely impacted by significant farm cost inflation and a lack of investment in farm infrastructure, leading to reduced productivity. A High Court judgment in May also noted a nearly $7 million balloon payment was due that same month under a livestock lease.
In October 2022, the Waitonui Group underwent farm debt mediation, but subsequently breached the terms of the resulting agreement. These breaches, along with issues related to the group’s banking facilities, led to the receivership of the entities within the group.
Milltrust International Group, which had invested in Waitonui in 2019, exited the investment just two years later. In a statement, Milltrust clarified that their divestiture in 2021 absolved them of any governance or financial influence over Waitonui’s operational decisions post-sale
SOURCE: STUFF