An investment company which bought dairy farms from the embattled owner of Woolnorth says it will focus on environmental and social responsibilities and animal welfare.

“We have been in dialogue with the Tasmanian Dairy Industry Authority, EPA Tasmania and Circular Head Council and we look forward to working with them, the community and local businesses to transform these assets,” Prime Value Asset Management dairy investments manager Kirsti Keightley said.

Van Dairy, which operates Tasmania’s biggest dairy farm, last week said it had sold 12 farms outside the gate of the actual Woolnorth property for $62.5 million to Prime Value.

Prime Value on Monday said it had bought 11 farms from Van Dairy.

It is understood another was nominated to a third-party entity.

Van Dairy and its owner – Chinese businessman Xianfeng Lu – have been under pressure over animal welfare, effluent management and infrastructure concerns.

“There have been recurring management issues around maintenance, the need for investment and the need to repair and improve capacity in effluent systems,” Greens Senator Peter Whish-Wilson said on Friday.

Mayor Daryl Quilliam said “a fair bit” of remediation work had been done, but more was needed.

Both hoped proceeds from the sale would go to improvements.

Prime Value alternative assets portfolio manager Elizabeth Blackhurst said: “We believe the Circular Head region of North-West Tasmania offers some of the best farmland in Australia and, with consistent rainfall and a temperate climate, it is ideal for sustainable and profitable dairy farming.”

“We also believe by focussing on our environmental and social responsibilities and the welfare of our animals we can create a farming portfolio that delivers long-term benefits to the community and strong, consistent returns for our investors, many of which are self-funded retirees and SMSFs (self-managed super funds).

“Our Prime Value Dairy Trusts are attracting more interest from investors who are looking for reliable and diversified sources of income.”

Ms Keightley said Prime Value was a hands-on manager willing to take the time to acquire, turn around and build quality assets.

“We already manage a farm in Tasmania near these farms, so this acquisition makes perfect sense for us,” she said.

“We’re excited by the potential of these farms and, with a falling national herd and falling national milk production, we believe this is the right time to be expanding our portfolio.”

Ms Keightley said the farms would be “managed really tightly” to make sure issues were not repeated, and Van Dairy had already done some of the necessary work.

“Getting the farms compliant is obviously number one,” she said.

“It’s not just about spending capital and putting infrastructure in, which we are obviously going to do.”

She said it was also about how systems were managed and making sure staff had the training they needed.

“It’s not difficult to do,” she said.

“You’ve got to make sure people have got the equipment and the skills to manage a lot of things on dairy farms and effluent is just one of them.

“We’re really about best practice, environment is very important to us.”

She said the sale was already leading to more local jobs.

Melbourne-based Prime Value said the deal continued the growth of its investments in premium Australian farmland.

It already owned two dairy farms in Victoria and one in North-West Tasmania.

The company started investing in Australian agriculture more than five years ago.

Describing itself as a boutique fund manager, it also manages equities, income securities, direct property and other alternative investments.

Its Prime Value Emerging Opportunities Fund was Australia’s second highest performing equities fund in calendar year 2020.

Sean Ford
MAY 31 2021 – 12:49PM

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