The law normally requires people who offer financial products to give information to investors before they invest. This requires those offering financial products to have disclosed information that is important for investors to make an informed decision. The usual rules do not apply to this offer if you are a person who comes within Schedule 1, clause 3(2)(a)-(c) or 3(3)(a)-(b)(ii) (inclusive) of the Financial Markets Conduct Act 2013. This includes where the amount invested upfront by the investor (plus any other investments the Investor has already made in the financial products) is $750,000 or more.
If you fall within Schedule 1, Clause 3 of the FMCA, as a result of this exclusion, you may not receive a complete and balanced set of information. You will also have fewer other legal protections for this investment. Investments of this kind are not suitable for retail investors. Ask questions, read all documents carefully, and seek independent financial advice before committing yourself.
The Offer is an offer to wholesale investors of 780 Units in Riverview Kiwifruit Limited Partnership, a limited partnership to be formed to acquire and further develop Riverview Orchard, a mature kiwifruit orchard with a mix of SunGold™ and green kiwifruit varieties. The Orchard is located at 191 Gow Road on the Rangataiki Plains near Edgecumbe in the eastern Bay of Plenty.
As a Riverview Kiwifruit LP unitholder (Unitholder), you will become a limited partner in Riverview Kiwifruit LP.
Subject to the success of this Offer, the Partnership will purchase and further develop the Orchard and meet syndicate establishment costs using a combination of $7.8 million of contributed capital to be raised in this Offer and $2.696 million of bank debt, a 26% debt funding level and a 30% loan to value ratio (‘LVR’). Note, the calculation of LVR excludes establishment fees and costs.
The Offeror reserves the right to use up to a further $1.848 million of bank debt and declare the sale and purchase agreement unconditional once it has received applications for $5.87 million of contributed capital. If only $5.87 million of contributed capital is raised, the LVR would increase to 50%. The Offeror also reserves the right to itself, or through associated entities, underwrite up to $1.0 million of contributed capital for a 2.0% fee payable by the Partnership.
The Offeror also reserves the right to accept or decline over-subscriptions and to determine which applications are accepted.
In the event that the Offer is under subscribed at the Closing Date of 5 February 2020, MyFarm will hold any unsubscribed units as Unpaid Units and continue to market these Unpaid Units on the secondary market after the Offer has closed, at the Offer price of $10,000/Unit.
The Orchard is 8.89 cha in size (5.07 cha in SunGold™, 2.91 cha in G14 and 0.91 cha in Hayward green varieties) and is being purchased for $8.2 million including the value of the 2020 crop. The 4. 97 cha in SunGold™ will be leased to DMS on a profit share basis from June 2020. The 3.82 cha in green varieties will be managed and converted to SunGold™ in 2020 and added to the DMS lease from June 2022.
DMS is a leading Bay of Plenty kiwifruit and avocado orchard management and post harvest operator. It is locally owned and operated and focused on providing services aimed at increasing orchard productivity and grower profits.
The Orchard is budgeted to be in full production by FY23 and from FY24 the Partnership is forecast to be providing limited partners with steady state cash returns on contributed capital of 8.2% p.a. In the next 3.25 years distributions are still expected to average 8.2% p.a but be more variable due to receipt of of crop proceeds and the impact of development.
The Offer is for 780 Units in Riverview Kiwifruit Limited Partnership at an issue price of $10,000/Unit. The minimum investment is 10 Units ($100,000) and thereafter the size of an investment can be increased in multiples of one Unit.
An initial payment of 2,000/Unit applied for is due at the time of the application. The remaining 8,000/Unit applied for is due for payment on the 14th February 2020 in time for settlement on the 20th February.
|Riverview Orchard||Edgecumbe||191 Gow Road, Edgecumbe, Whakatane, 3913|
|Riverview Orchard Development||Edgecumbe||191 Gow Road, Edgecumbe, Whakatane, 3913|