image

Top three Aussie dairy portfolio hits the market, PwC on board

Duxton Asset Management is getting ready to milk its decade-long investment in Victorian dairy business Ace Dairy Holdings.

Ace Dairy owns 4,000 cows, which produce 2 million megalitres of milk solids a year. 

Duxton’s Ace Dairy has drafted in PwC’s dealmakers – and Victorian real estate firm LAWD – to help it find a new owner, in a deal expected to value the business around the $70 million mark.

Ace owns one of the top three portfolios of dairy assets in the country, which includes seven dairy farms across 2,040 hectares in Victoria’s prime agricultural east Gippsland region, according to a sale flyer sent to potential buyers.

The farms have access to close to 8,000 megalitres of irrigation water, mainly sourced from the Macalister irrigation district, and they’re home to 4,000 cows producing 2 million kilograms of milks solids annually.

That milk is understood to be all under contract to one buyer, in a deal that still has a few years left to run.

It is understood Duxton’s keen to test buyer interest following an outbreak of agriculture sector M&A activity, including some fiercely contested auctions.

A case in point is the bidding war waging between MIRA and Roc Private Equity for ASX-listed Vitalharvest, that has been running since February.

Other big agricultural assets on the market include US-based Macquarie Crop Partners’ Lawson Grains and one of the country’s biggest cotton growers and ginners Auscott Ltd – both are expected to fetch north of $500 million.

Ace’s advisers PwC and LAWD fired the starting gun on the sale this week when they sent the flyer to potential buyers. The advisers called for expressions of interest by mid-June and were planning to run a two-stage auction.