Billionaire Joe Lewis adds more Australian Agricultural Company shares in his knapsack
Billionaire Joe Lewis has taken his stake on the Australian Agricultural Company’s share register to 23%.
Suggesting he ultimately wants control of Australia’s biggest beef producer, the Bahamas-based British currency trader – who owns English Premier League club Tottenham Hotspur - was the major backer of AACo’s $299 million capital raising in August last year, when his holding stood at 13.5%.
Lewis can next increase his stake by an extra 11.6% on 1 September, then potentially commanding almost 35% of the register, the Australian Financial Review has suggested.
Employing around 430 staff, AACo has 18 owned cattle stations, five agisted properties, two owned feedlots, five external feedlots, and two owned and two external farms located throughout Queensland and the Northern Territory, covering approximately 6.9 million hectares with around a 676,000-head cattle herd.
Last year it sold subdivisions of its Goonoo aggregation, including Adelong, in Central Queensland for $23 million. It also sold Brighton Downs Station, passed in at Elders auction for $10.25 million, for $11.75 to the neighbours of the 420,000 hectares (1.04 million acres) station near Winton, the Britton family.
Last October it added the former RM Williams Agricultural Holdings properties, La Belle Downs and Welltree Stations southwest of Darwin paying $27.1 million through a Colliers marketing campaign for the properties, with a carrying capacity of between 20,000 to 25,000 adult cattle, but were sold bare of cattle. The 100,000 hectare properties will make up 1.6% of AACo’s total land holdings.
Labelle Downs and Welltree are close to Tipperary, totalling 3,434 square kilometres, which AACo operates under a long-term lease.
AAco's largest shareholder, South East Point, is controlled by the Bahamas-based UK Tavistock group headed by the aggressive investor Joe Lewis whose stake recently overtook AACo's other major shareholder, the Malaysian-Middle Eastern Felda-IFFCO consortium with a 16.9% stake, given Felda-IFFCo did not take up its entitlement in the September 2013 capital raising.
Tavistock has been on the share register since 2011.
Other smaller shareholders are David Dixon and Catherine Ramm, Anthony Maurici, Neasham Holdings and Catholic Church Insurance, according to its 2013 annual report. Elders and Peter Holmes à Court are no longer among the 7200 shareholders.
The Australian Financial Review reported when the former AACo chief executive David Farley was departed in July last year, bush rumours started that Lewis wanted to break AACo apart and grab the cash from selling off its land and cattle assets. But AACo chairman Donald McGauchie, the former National Farmers Federation boss, staunchly denied the rumours.
Those rumours have been denied many times by the Tavistock company too.
“We have increased our holding in AACo as a measure of our belief in the company and its endeavours to build a grand and integrated supply chain,” a spokesperson told the AFR earlier this month.
Lewis' total wealth is estimated at $4.2 billion, and he is listed as the 308th richest person on Forbes 2013 List of billionaires. Forbes reports that Lewis is the ninth wealthiest person in the UK, though he spends the majority of his year working from his luxury yacht.
Lewis is the main investor in Tavistock Group, which owns more than 200 companies in 15 countries.
Dr. Shehan Dissanayake has been Tavistock's representative on the board as a non-executive director of Australian Agricultural Company Ltd since April 2012. He is a senior managing director and member of the board of directors of the Tavistock Group, the privately held investment company.
Before joining Tavistock Group in 2002, Shehan was a managing partner of Arthur Andersen.
Jason Strong, the AACo ’s general manager marketing, was been appointed managing director and chief executive officer in January while in March Troy Setter, the company’s chief operating officer, felt for a job at rival, Consolidated Pastoral Company.
AACo owns roughly 1% of Australia's land mass. It was in 1824 that AACo was established as a land development company with the assistance of the British Parliament's Crown Grant of 1,000,000 acres in the Port Stephens area of the Colony of New South Wales.
In 1831, due to the unsuitability of the initial land grant at Port Stephens, a portion of it was exchanged for 101,000 hectares at Warrah on the Liverpool Plains and 127,000 ha on the Peel River, which was to eventually become known as Goonoo Goonoo. Shorthorn bulls were imported from England to develop the company herds.
The company, in its move north selling subdivisions of its southern estates which helped to finance the purchase of Headingly at Urandangie in Queensland in 1916 and Avon Downs in the Northern Territory in 1921.
In 1948, the geographic and enterprise diversification that the company was hastened with the purchase of Rockhampton Downs in the Northern Territory and South Galway in the Channel Country.
In 1950, AACo purchased Brighton Downs on the Diamantina in and, assisted by the Korean War Wool Boom, moved into the East Kimberley region, purchasing the properties Auvergne, Newry, Argyle Downs and Ivanhoe.
In 1963, the company purchased Wrotham Park in North Queensland. However, a period of rationalisation in 1979 saw the sale of the Kimberley Group and the purchase of the renowned Brunette Downs on the Barkly Tableland.
It was 1985 which saw the end of a 160-year ownership with the sale of Goonoo Goonoo on the Peel River which allowed the company to purchase of properties in the Gulf of Carpentaria, Gregory Downs, Canobie and Dalgonally. In 1987, another Gulf property, Wondoola, was purchased after the sale of Caldervale.
The purchase of a further breeding station, Austral Downs in the Northern Territory followed in 1994.
In 1996, the New South Wales property, Windy, the last vestige of Warrah, was sold, after a continuous period of ownership spanning 165 years.