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• Equity Partnerships
• NZ Equity Partnership Seminars

Equity Partnerships

The information below has been summarised from seminars contacted in Tasmania in 2006 by Dairy Consultant John Wilson and ANZ. Further information can be obtained from John and the ANZ (see contacts section of the website).

The steps in a equity partnership arrangement are:

1. Establish in your own mind the reason you want to invest in dairying and are you prepared to accept part ownership in an equity partnership.
2. Either

*Identify the property/opportunity

• Identify the people you would like to invest with, or
• Contact intermediary who is involved in the area of Equity Partnerships

#Due diligence
Once the opportunity is established you will need to do your research. This should cover:

• People with experience in the industry
• People with farming experience in the area
• People with equity partnership experience
• Quantify the resource base (land, water, soils, climate, production)
• Quantify capital costs, income and expenditure

#Identify and find key man
This preferably is the equity manager. This person needs dairy expertise, capital, ability to produce financial results and ability to communicate at all levels.

1. Secure property, stock and development expertise. Includes banking and financial arrangements.
2. Legal requirements

The rules need to be spelt out in a legal document. A structure for the partnership needs to be established which is fair to all, tax effective and flexible enough to allow parties to come and go.
Legal documents are likely to include:

• Shareholder's agreement
• Farm and stock purchase
• Sharefarming
• Management
• Land lease

The legal documents need to be tailored to the individual equity partnership.

1. Establish business protocol

*Capital budgeting

• Cashflow budgeting
• Development Plan and timeframe
• Farming system
• Risk exposure
• Reporting functions
• Directors roles and responsibilities
• Board meetings

Presentations from the seminars are provided in the attached documents.
Equity Partnerships Seminar - PDF

Equity Partnerships Seminar - John Kelly PDF

Equity Partnerships Seminar - John Wilson PDF