Rural Funds Group has picked up a 28k hectare cattle and cropping property in central Queensland for almost $70 million.
The new station called Kaiuroo is split into four properties and comes with water entitlements is about 200 kilometres inland from Rockhampton, approximately 5 kms west of ‘Cerberus’, an existing cattle property owned by Rural Funds.
Rural Funds said the acquisitions are consistent with its strategy of acquiring assets with potential for productivity improvements, in agricultural sectors in which they have operating experience and Australia has a comparative advantage.
Included in the purchase is 12,448 ML of water entitlements. RFF plans to utilise the water entitlements to improve the productivity of the properties. Productivity developments include expanding irrigated cropping areas and increasing cattle carrying capacity through pasture improvement and additional water points.
A deposit of $17.2m (25% of the purchase price) is expected to be paid in November 2021, funded from the company’s debt facility. It also negotiated an extended settlement period of up to 24-months, which allows them to commence productivity developments and seek a lessee prior to settlement.
Forecast FY22 adjusted funds from operations of 11.8 cents per unit and distributions of 11.73 cents per unit remain unchanged.
The company’s share price hit an all-time high of $2.99 last week. It has fully recovered from a short attack in 2019 that saw its share price plummet nearly 42% in one day from $2.31 to $1.35. It subsequently took Texas-based Bonitas Research to court and was awarded $900,000 in damages.