Roc Partners and MIRA were underbidders in Auscott sale

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The two parties battling it out for the Vitalharvest Freehold Trust – Roc Partners and Macquarie Infrastructure and Real Assets – have emerged as under bidders in the competition for cotton producer Auscott that sold this week for $500m.

Australian Food & Fibre, backed by PSP, was named as the buyer of the Australian cotton producer Auscott on Monday, but others said to be in the frame were MIRA and Roc, along with the Queensland Investment Corporation and IFM and funds out of North America and commodity traders.

Olam International also had an early look in the competition that is understood to have drawn a large field of prospective suitors.

Roc and MIRA have been competing fiercely for Vitalharvest, which is the landlord of the listed fruit and vegetable grower Costa Group.

On May 11 the real estate owner announced that it had accepted a $1.28 per unit bid from Macquarie, trumping a last minute offer from Roc at $1.27 per unit and valuing the trust at $236.8m.

The Auscott sale by California-based J.G Boswell Company was understood to have drawn a large field of prospective suitors at a time that the agricultural sector with the drought breaking in Australia last year and a low interest rate environment brought on by the pandemic fuelling spending globally.

It operates about 22,000ha of developed cotton country in NSW, and has five ginning facilities and a 143,000ML water portfolio.

Auscott sold its Midkin cotton business at Moree in northern NSW for $300m in 2019.

The buyer of the Auscott, Australian Food & Fibre, is a joint venture between the Robinson family and Canada’s Public Sector Pension Investment Board.

PSP, is one of Canada’s largest pension investment managers and has been a long-term investor in Australian agriculture. Sources say that the group is believed to be gearing up for more acquisitions.

Some question whether the Canadian group acquires the remaining interest it does not own in the Smorgon family-backed fruit and vegetable grower Perfection Fresh which is on the market through Goldman Sachs.

Price expectations for the business are thought to be up to $400m, and groups such as Roc and MIRA are also expected to be interested buyers.