Saudi Arabian investors and Perth-based agricultural investment fund PenAgri are set to sell Western Australia's largest grain operation, Merredin Farms, in a deal anticipated to approach A$200 million.
This transaction follows a series of notable sales in Western Australia's agricultural sector, despite the challenges of lower commodity prices and higher interest rates impacting farmland returns.
Merredin Farms, covering around 80,000 hectares in WA's wheat belt, is a major producer of wheat, barley, and canola. The Saudi Agricultural and Livestock Investment Company (SALIC), owned by the Saudi Government, and PenAgri, directed by agriculture investor Greg Harvey, jointly own the operation.
SALIC's share of the portfolio was originally part of a larger acquisition from John Nicoletti in 2019, valued between A$65 million and A$70 million.
This sale underscores the dynamic nature of WA's agriculture sector, following recent transactions like Hui Wing Mau's A$300 million cattle portfolio sale and the purchase of a Quintis plantation by Ron Greentree. Despite regional challenges, WA continues to attract significant agricultural investments.
Rawdon Briggs and Duncan McCulloch of Colliers, the selling agents, noted the strategic importance of Merredin Farms. The acquisition would establish the buyer as the state's preeminent broadacre farmer.
SALIC aims to refocus its strategic investments in various agricultural value chains, as explained by their Australian CEO William England.
“The portfolio offers a turnkey corporate farming operation inclusive of world-class governance, HR, procurement and work, health and safety systems, all focused on growing wheat, canola and barley sustainably,” said England.
The sale is indicative of the ongoing interest and adjustments in the agricultural investments landscape in Australia, particularly in grain production, which remains a vital sector in the Australian economy.