On 19 November 2015, Scott Morrison, Treasurer of Australia
announced that he would not authorise the proposed acquisition by
foreign investors of S. Kidman and Co. Limited. Mr Morrison stated
that he would not be authorising the sale to proceed as currently
proposed on the basis that the sale was contrary to the
"national interest". Mr Morrison indicated that the
factors that he had taken into account in considering the
"national interest" included the size and significance of
the total portfolio of Kidman properties along with the national
security issues around access to the Woomera Prohibited Area
(WPA). Mr Morrison's decision was consistent
with the recommendation from the Foreign Investment Review Board
Under the Foreign Acquisitions and Takeovers Act 1975
(Cth), all foreign investment applications are examined against
Australia's national interest. FIRB Policy describes the
'national interest' assessment as a mechanism for the
Government to balance potential sensitivities against the benefits
of foreign investment on a case-by-case basis. Under FIRB policy,
the "national interest" test takes into account a range
of factors, including the following:
the impact on the economy and the community
– the impact of the investment on the general economy,
including any plans to restructure an Australian enterprise, the
nature of the funding of the acquisition and the level of
Australian participation in the enterprise
national security – the extent to which
investments affect Australia's ability to protect its strategic
and security interests
consistency with other Australian Government policies
including tax– the impact of a foreign investment on
Australian tax revenues
competition – the extent to which an
investment may result in an investor gaining control over market
pricing and production of a good or service in Australia
character of the investor – the extent
to which the investor operates on a transparent commercial
In his announcement, Mr Morrison indicated that he had taken
into account the following matters:
One of Kidman's stations,
Anna Creek, is also the largest single property holding in
Importantly, around 50 per cent
of the Anna Creek pastoral lease is located in the [WPA] in South
The WPA weapons testing range
makes a unique and sensitive contribution to Australia's
national defence and it is not unusual for governments to restrict
access to sensitive areas on national security grounds.
Given the size and significance
of the total portfolio of Kidman properties along with the national
security issues around access to the WPA, I have determined, after
taking advice from FIRB, that it would be contrary to
Australia's national interest for a foreign person to acquire
S. Kidman and Co. in its current form.
Kidman is Australia's largest private land owner and holds
approximately 1.3 per cent of Australia's total land area, and
2.5 per cent of Australia's agricultural land. Kidman owns and
operates 10 cattle stations, including properties across regional
South Australia, Western Australia, the Northern Territory and
Queensland. Those cattle stations cover approximately 101,411
square kilometres and manage a long-term average herd of
approximately 185,000 cattle.
Mr Morrison has noted that following communication of his
decision to all bidders to acquire S. Kidman and Co. Limited have
elected to withdraw their FIRB applications prior to his Final
Order being formalised.
Mr Morrison has indicated that he will now "consider any
such future alternate proposal or set of proposals on its merits,
consistent with his obligation to ensure that, any such sale is on
terms that are not contrary to the national interest." It will
now be a matter for the vendor to consider how they propose to
proceed with offering the composite interests of S. Kidman and Co.
Limited for sale.
Mr Morrison reiterated that "Australia welcomes foreign
investment where it is consistent with [its] national
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