`Chinese Investors Purchase Australia's Kailis Organic Olive Oil - Olive Oil Times

Chinese Investors Purchase Australia's Kailis Organic Olive Oil

Oct. 17, 2012
Charlie Higgins

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Six Chinese investors have signed a AUD$15 mil­lion ($15.47 mil­lion) deal for the pur­chase of the olive oil com­pany pre­vi­ously owned by two of Western Australia’s most promi­nent busi­ness fam­i­lies, the Kailises and the D’Orsognas.

Kailis Organic Olive Groves was founded in 2001 by Mark Kailis, grand­son of Kailis patri­arch George Peter, and son of Peter Kailis, who founded fast food chain Red Rooster in 1972. 

In 2010 the com­pany bought the olive grove and pro­duc­tion assets of Australian agribusi­ness Great Southern.

The company’s other investors included Marco D’Orsogna, co-owner of Italian goods man­u­fac­turer D’Orsogna, and Sydney invest­ment banker Christopher Ryan. Peter Kailis owned about 30 per­cent, with the remain­ing 10 per­cent belong­ing to Mark Kailis and other fam­ily mem­bers.

Prior to the buy­out, Kailis Organic Olive Groves had expe­ri­enced a rough cou­ple of years, with AUD$3.4 mil­lion ($3.5 mil­lion) in losses reported in 2009 – 2010. At its height the com­pany owned 3,813 hectares of plan­ta­tions in Western Australia, sell­ing around 80 per­cent of its prod­ucts to domes­tic mar­kets and export­ing to seven coun­tries, includ­ing the United States.

Weakened by low inter­na­tional olive oil prices, the com­pany had amassed $18 mil­lion in debt by the time it was handed over to receivers and admin­is­tra­tors in November 2011. Scott Langdon of KordaMentha, an Australian busi­ness known for their work as insol­vency and restruc­tur­ing spe­cial­ists, said the deal would at least secure the jobs of the roughly 100 peo­ple employed by Kailis Organic.

It sold as a going con­cern with all employ­ees trans­ferred to the new entity,” Langdon said. It’s a pleas­ing result that the organic olive busi­ness is going to con­tinue through­out South East Asia with great prospects.”

According to The West Australian, sources close to the Kailis deal said that it was another indi­ca­tor of the grow­ing afflu­ent class in China and other Asian coun­tries, where more investors are seek­ing to diver­sify their wealth by acquir­ing large land hold­ings abroad.

According to the 2013 Beijing International Oil Expo, China is set to become the largest olive oil mar­ket in the world. Though con­sump­tion is still lim­ited to the high end due its cost, lower prices could result in China con­sum­ing half of the world’s olive oil.


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