How Tony Perich and family feed the growth of Freedom Foods

Freedom would now have a shareholding worth at least $1.7bn had it held on to its shares in just one company.

Tony Perich. Picture: David Moir

The wealth of Tony Perich and family keeps going up as the fortunes of western Sydney rise and rise.

Their collection of private businesses, led by Leppington Pastoral and including huge land projects at Oran Park and one of the biggest shopping malls in the country, made pre-tax profits of more than $200m last year.

But there is also a tale of missing out on what has proven to be a huge deal.

When it comes to the listed company scene, Tony Perich and his family would qualify for The List - Australia’s Richest 250 with just their stake in Freedom Foods.

The Perich shareholding in Freedom Foods - which produces a range of allergen-free breakfast cereals, such as gluten free and dairy products - is now worth about $750m. Freedom also makes a range of fresh and long-life drinks and seafood. Its brands include Crunchola, So Natural, Australia’s Own and Norganic.

It has proven to be a terrific deal for Perich, who first paid a mere $3m for 5 million shares in what was then called So Natural Foods Australia on New Year’s Eve in December 2004. That deal entitled Perich to a 10 per cent stake in a company then worth about $30m.

Today, Perich has a 54 per cent stake in Freedom, which has a market capitalisation of about $1.42bn. The family’s current stake is as a result of spending $35m topping up his stake in the company in the middle of last year, when it raised $130m in an entitlement offer and institutional placement with the aim of spending the money on expanding its capacity to process nutritional ingredients.

Freedom shares fell at the time, late last August, as it downgraded its full-year profit guidance. But the shares have since bounced back, rising more than 25 per cent in about five months. They are up almost 3 per cent since the beginning of 2020.

Yet when it comes to discussing the Perich and Freedom Foods wealth story, there is always a caveat in the form of the ASX-listed a2 Milk.

While Perich is immensely wealthy, he and his family would have been even better off had he and Freedom remained shareholders in a2, having sold its 117 million shares for $93m in 2015 at a price of about 77c a share on average.

At the time, Freedom owned about a fifth of a2 stock but decided to sell after a takeover move was rebuffed.

A2 Milk shares finished trading at $15.50 last Friday. At that price, it means Freedom would have had a shareholding worth at least $1.7bn had it held on to its shares for another five years.

While Freedom is their biggest shareholding, the Perich family also has a diverse range of private investments, including fertiliser, wood shavings and transport holdings, and a share in Pulai Mining, a company mining for gold in central Malaysia.

But most of the Perich wealth is based on their extensive property developments and holdings in Sydney’s west and the Leppington Pastoral enterprise. His Croatian immigrant parents established a dairy farm in 1951 with 25 cows. Leppington Pastoral now has more than 2000 cows across 11,000 hectares.

Leppington Pastoral Co made a net profit of $113m in 2019, according to documents recently lodged with the corporate regulator, and has net assets of $625m on its balance sheet.

Then there is the family’s property holdings. Greenfields Development Company is developing thousands of residential lots as well as the Oran Park town centre project. The family last year lodged an application for a green space to be named Perich Park.

Perich also owns half of Dart West Developments, which has a retail arm that owns what has been described as Australia’s largest family-owned shopping centre, Narellan Town Centre.

Narellan is situated near Campbelltown, 60 kilometres southwest of the Sydney CBD, and is a sprawling complex which three years ago underwent a $200m expansion which added 70 shops to what was already a considerable precinct.

The Mall has $550m in moving average turnover annually in 72,000sq m of retail space.

Greenfields Development had a net profit of about $4m last year, while Dart West made a $20m profit.