MACKAY Sugar has ramped up its drive to retain as much cane producing land as possible with the acquisition of a 714 hectare property.
The company has bought Marwood Farm, in conjunction with American-based asset management firm Black River Asset Management, for $10.5 million. The farm is one of the largest in the Mackay region and is located halfway between Homebush and Sarina, on Marwood Rd.
It is the first time Mackay Sugar has made such a purchase. The company paid $1 million (15%) into the investment fund, known as Racecourse Projects, while Black River paid the balance.
It's a situation Mackay Sugar chief executive officer Quinton Hildebrand said would continue while the company reached for its goal of 5000ha of additional land under cane in the next five years. "Future investment by Racecourse Projects into cane land development will boost our cane supply to our mills, enabling us to produce more sugar and bagasse," Mr Hildebrand said.
"The partnership with Black River will ensure that Mackay Sugar will retain influence on the long-term growth of this cane farming business."
The property's former owner, GRD Properties Pty Ltd director Graham Davies, said the sale was a "win-win". "It is consistent with Mackay Sugar's strategies and is also consistent with my own succession planning," he said.
Canegrowers Mackay chairman Paul Schembri welcomed the announcement. "The security and protection of our area under cane is critical to our future," he said. "One of the greatest threats to our industry is the loss of cane and if this protects (that) we obviously support it."
But he said transparency was the key to making sure future land acquisitions proceeded smoothly.
Mackay Sugar is a co-operative owned by growers and investors.
"Growers will need to be comfortable about the transactions and that they have been applied at their market value," Mr Schembri said.
"Mackay Sugar has given a commitment to the extent it can to ensure transparency around these transactions."
Update your news preferences and get the latest news delivered to your inbox.