In an announcement to the New Zealand Stock Exchange today (Oct. 23 NZDT), the company said it had entered agreements to sell five orchards in the Northland region out of a portfolio of nine farms that were offered for sale in August.
Seeka claimed the total sale value of NZ$15.86 million (US$10.41 million) exceeded its purchase price plus holding costs for the orchards sold.
Negotiations are ongoing for the remaining properties in the portfolio.
“Four of the orchards were purchased from Turners and Growers Horticulture Limited as part of Seeka’s acquisition which was announced on 20 April 2018. Seeka has an option to purchase the fifth orchard and that option has been exercised,” the company said.
“The agreements include the purchasers entering into long term supply contracts for each of the orchards with Seeka, and Seeka will manage the orchards on behalf of the purchasers.”
The agreements are conditional on the purchasers completing due diligence within 20 days.
Settlement for three of the orchards will occur upon subdivision, which is expected with the next two to six months, while settlement of the remaining two orchards is scheduled 10 days after due diligence is completed.
Seeka added the sales were not subject to Overseas Investment Office or other regulatory approvals.
In a statement in July, Seeka chief executive Michael Franks said it had always been the intention to market the properties in Kerikeri, Northland while the group focused on a NZ$18 million refurbishment of a post-harvest facility that is expected to take around three years to complete.
“This is an excellent opportunity for investors to gain a significant stake in prime New Zealand horticultural orchards and land, with a mix of mature orchards in production, orchards in development, across kiwifruit and avocados,” Franks said at the time.