Beefing-up investments

Emirati group IFFCO is thought to be looking at a major increase of its stake in Australian Agricultural Company, drawing on the deep pockets of its Indian and Emirati backers, particularly the Allana family, who have agricultural interests across the world.

Insiders to the transaction are now expecting IFFCO, or International Foodstuffs, to buy Futuris' remaining stake in AACo, giving it a dominant stake. Represented by UAE-based Lithuanian Arunas Paliulis, the privately-held IFFCO has deep pockets. The Sharjah-headquartered firm has a vast business operating from its base on the Arabian Gulf, which ranges from palm oil in Malaysia to biscuits and confectionary sold throughout the Middle East.

IFFCO is run by Emirati businessman Iqbal Othman and is backed by the Allana Group, one of India's biggest exporters of agricultural products and the world's largest producer of halal buffalo meat. Two members of the wealthy Allana family, which have been trading in Bombay since the days of the British Raj, sit on the IFFCO board. The family also have a stake in Al-Kabeer, a frozen food business with operations around the world.

IFFCO has already demonstrated that it is anything but a passive investor at an extraordinary general meeting of AACo shareholders (AACo's jilted jackaroo). Leading a vote against AACo's proposed purchase of Allan Myers' Tipperary and Litchfield cattle stations, IFFCO and a majority of AACo shareholders stymied the transaction, in which Myers would bring his properties to the table effectively in exchange for $15 million and a 19.9 per cent shareholding in AACo which had been sold by Futuris.

IFFCO bought its shares from Futuris for cold hard cash (which Myers did too, if one remembers that he would soon have been getting $105 million for the stations) and presumably this is what ticked them off. IFFCO furthermore disputed independent expert BDO Kendalls' valuation of the two Northern Territory stations, something which AACo and BDO have vigorously defended.