BIG beef business Australian Agricultural Company (AACo) has an empty board seat to fill following this week’s resignation of one of its seven directors, the United Arab Emirates-based director Adil Allana.
Nanjing Night Net

Last week the UAE company IFFCO Poultry’s joint venture shareholding with Malaysian business Felda quit an eight per cent stake in AACo after six years as its biggest, then second biggest shareholder.

The decision came just days before AACo’s much-anticipated $93 million new abattoir at Livingstone, south of Darwin, was officially opened by Prime Minister Tony Abbott.

The meatworks, which began processing last October, will eventually handle up to 220,000 head of cattle a year, providing boxed beef cuts to domestic and international markets, including the United States and Asia.

Last week UBS Group AG picked up 38 million AACo shares unloaded by IFFCO-Felda, giving the Swiss financial services company approximately a 7 per cent stake in Australia’s oldest listed company.

IFFCO, run by successful Indian expatriate Feroz Allana, was established in the UAE in 1975 and now makes and markets an array of consumer products ranging from frozen food to vegetable oil and dairy goods and provides institutional food sector services.

It is also a significant exporter of agricultural products from India where it is a major red meat processor.

Adil Allana, who has been on the AACo board since August, 2013, is a member of IFFCO’s supervisory board in the UAE and a prominent figure with Allanasons Limited, part of India’s Allana Group agribusiness which has leading positions in the meat, coffee, spice and edible oil sectors.

IFFCO-Felda’s investment in AACo began in early 2009 when the partnership paid about $3 a share to buy a 15pc stake in the company held by former Elders parent company, Futuris.

The partnership played a handy background role in stabilising AACo’s market ambitions, expressing interest in helping AACo open new markets in the Middle East and Malaysia for the Australian company’s 600,000-strong herd.

Felda was also looking to develop its own cattle business alongside its vast palm-oil plantations and oil processing operations, possibly including lot feeding stock imported from Australia.

However, recent reports have suggested “strained” relations within the Felda and IFFCO alliance, while changing management priorities in Malaysia are believed to have diluted support for the AACo investment objectives.

The joint venture’s stake in AACo, which had been as high as 17pc, shrank in recent years particularly when it declined to take part in the 2013 capital raising share offer.

It slipped behind Bahamas-based British billionaire Joe Lewis, whose Tavistock Group now owns approximately 26pc.

AACo runs a strategic balance of 21 properties, feedlots and farms comprising around 7 million hectares – about 1pc of Australia’s land mass – in Queensland and the Northern Territory.

AACo’s remaining board members include a Tavistock representative, Shehan Dissanayake; former National Farmers Federation president, David Crombie; former GrainCorp boss Tom Keene and prominent agribusiness director, Don McGauchie.

The company’s share price, which had been below $1.50 earlier this month, has continued an upward trend to trade around $1.57 early this week.

This story Administrator ready to work first appeared on Nanjing Night Net.