Apart from Australia's agriculture sector, where China has shifted its focus away from commodities iron ore and coal, the world's second-largest economy has decided it wants to have a piece of Australia's dairy sector as well.
China Investment Corp. (CIC), China's sovereign wealth fund, in a bid to build up sufficient supplies for its growing and urbanising population, currently at 1.3 billion people, has been reported to have sent representatives this month to Tasmania to look for potential business partnerships.
The Australian Financial Review said on Monday the four CIC representatives have noted particular interest on the Van Diemen's Land Company, Australia's largest dairying operation that operates in Tasmania. To express its seriousness to acquire a controllership, CIC was said to have approached for preliminary consultations Australia's Foreign Investment Review Board. It had also submitted a formal application pending a finalised agreement, the AFR report further said.
Located north-west of Tasmania, Van Diemen's Land Company maintains some 19,000 hectares in 27 farming operations, most of them dairying. It likewise owns 25,000 dairy cows and 6,500 beef cattle. It employs about 160 people.
It is open to double its production and workforce with a $180 million investment, BusinessDay reported.
"We would welcome a Chinese investment in our dairy industry," Tasmania Premier Lara Giddings was quoted by the AFR as saying to CIC president, Gao Xiqing, during a visit to Beijing. Ms Giddings noted the sovereign fund's particular interest in exploring agricultural opportunities in Tasmania.
In its Web site, the CIC said it ''usually does not take a controlling role - or seek to influence operations - in the companies in which it invests'."
''CIC maintains a strict commercial orientation and is driven by purely economic and financial interests. CIC selects investments based on established investment principles and values.''
Michael Guerin, chief executive of the Van Diemen's Land Company, confirmed to The Age on Sunday night that it had been seeking for some months now domestic and international assistance to raise much needed equity, estimated $180 million, to support its expansion plans.
But he did not confirm nor deny any ongoing negotiations with CIC.
''There has been a lot of interest. We remain confident that we can raise the money for our plans,'' he said. ''There are a number of investors potentially interested in our project.''
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