Yougawalla sets sights on a $70m sale

03 Dec, 2015 03:00 AM
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Yougawalla part owner and manager Haydn Sale seeks a new partner or buyer of the $70 million pastoral company.
Yougawalla part owner and manager Haydn Sale seeks a new partner or buyer of the $70 million pastoral company.

STRONG beef prices and interest in the Australian beef industry has put another prominent WA cattle station up for grabs.

Yougawalla Pastoral Company, in its entirety, was officially listed for sale last week.

It includes Yougawalla station, East Kimberley, Bulka station in Central Kimberley and Margaret River station, East Kimberley and four sub-leased Aboriginal-owned pastoral leases that make up 1.4 million hectares and about 42,000 head of cattle.

The Sale family manage and part-own Yougawalla with partners Harold Mitchell, who sold his media buying business to London-based Aegis Group in 2010 and former Seven West Media director Doug Flynn, who are expecting $70 million for the sale of Yougawalla.

According to manager Haydn Sale, the timing was right.

"We are looking for either a partner in the business or considering an outright sale of the business," Mr Sale said.

"We have a partnership that has been together for eight years, so we are looking to dissolve that, as the other partners are looking to move on.

"We had a five-year plan and are well and truly beyond that.

"We looked at finding a partner earlier in the year but decided it wasn't the right time, because there were a lot of bigger deals on the table, like S.Kidman & Co.

"Now that is running towards the end, we thought it was time to test the waters."

Mr Sale said the property market was looking very strong.

"We are hoping to have potential new buyers by the start of next year so we can start the mustering program off under a different entity," he said.

"It will be a walk-in, walk-out sale.

"It will be the three stations and we have some long-term leasehold country around that, with cattle and equipment."

Mr Sale said while there was interest, if nothing transpired, the partners were keen to carry on.

As for the Sale family, Mr Sale said if the business was sold, there was a possibility the family could continue to manage the stations.

"We will have to take it as it comes," Mr Sale said.

"If it's a partnership we will continue on.

"If it is a sale, well, from the people we have spoken to so far, they want us to stay on and manage.

"While it depends on what the entity is, we will probably stay in the business for the next few years.

"If that doesn't happen, we will have to take it as it comes, but as for us, we will stay in the north - it is the best place to be."

The partners bought Yougawalla in 2008, survived the 2011 live export ban and since then purchased further land holdings during this time, growing from 1000 head of cattle to its current 42,000 head.

Mr Sale said they could double the stock numbers on the available land they have.

"We are using less than 50 per cent of the land we have at the moment," he said.

"So the idea is to keep going with its development and increase cattle numbers."

Mr Sale said they are hoping to get approval to grow hay on the station and then look to apply to implement centre pivot irrigation.

The weaker Australian dollar and strong beef prices driven by solid Chinese demand has prompted significant Australian buyers and overseas investors expressing their interest in Australian cattle stations this year.

"We have overseas buyers who are interested but we don't really know who will come to the table as yet," he said.

"We have some significant overseas groups, but also some significant Australian interest, so you don't really know.

"I think there is more interest from other Australian groups, not just the Chinese.

"They have been a bit slow off the mark, but they have worked out it can be a pretty good business, so you can see super funds, pension funds and those groups looking at it."

It is understood that ANZ Banking Group and KPMG Corporate Finance have been assigned to sell Yougawalla.

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Jacinta Bolsenbroek

Jacinta Bolsenbroek

is a senior journalist at Farm Weekly

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