AUSTRALIA'S largest landholder, S. Kidman & Co, has re-entered the depressed cattle station market for the first time since prices started collapsing in 2007.
The company has purchased Rocky Bank cattle station at Roma, western Queensland, from the estate of late world bull riding champion John Quintana who was killed in a plane crash earlier this year.
The 14,600 hectare station was bought for $7.4 million from the receivers McGrathNicol who are handling the estate.
The property will now be used as a stud breeding centre for the company.
S. Kidman & Co managing director Greg Campbell confirmed the transaction and said the company had been looking for property in the area for the past eight years but could never make any acquisitions stack up.
"Sometimes you just have to be patient and wait until there is a deal where there is a clear value proposition," Mr Campbell told The Australian Financial Review.
"Because we could never make the real estate stack up we had to contract out our stud cattle management. Now it makes sense to concentrate all this back in one place."
He said the efficiency the company would gain from concentrating its stud cattle back in one main centre meant the company could spend money buying land.
Depressed market
"It is clearly a depressed market so we were able to buy in at a price much less than five years ago. It's hard to say when this market will turn around and the value of this land might even fall a bit further."
The well watered property, with varying qualities of buffelgrass, mitchellgrass and bluegrass, was snapped up ahead of four other cattle operators who intended to use the property for other purposes.
The move by S. Kidman & Co is significant because Australia's major cattle operators such as the Australian Agricultural Company and Terra Firma backed Consolidated pastoral have been absent from the market.
The move also adds to renewed positivity this year by buyers.
In July, the private McMillan Pastoral Company bought one of the first major cattle stations sold in the Northern Territory for almost two years.
The company purchased the 481,000-hectare Calvert Hills in the region's east for $15 million walk-in, walk-out, with 15,000 head of cattle.
Ruralco Property GDL's Andrew McCallum, who negotiated the sale of the Rocky Bank property, said with such little sales evidence in the past year in the Roma district, the recent transaction would give some clarity as to where the market is now heading.
"We have seen the market improve through the level of interest but it definitely hasn't followed in terms of price," Mr McCallum said.
"There has been a big adjustment. Without that adjustment there would be no sales."
While interest had improved, there was still a very slim margin between the losing and winning bidders.
