Italian confectionery giant Ferrero to sell NSW Riverina farms Dellapool

Italian confectionery giant Ferrero, maker of famous treats Nutella and Ferrero Rocher, is selling 2665ha of farmland and a massive water portfolio.

Australian arms of the Ferrero company purchased the Dellapool farms about 12 years ago.

Italian food giant Ferrero, via its Australian arms, is selling its 2665ha NSW Riverina two-farm aggregation and a massive water portfolio as the company exits its Australian agriculture venture, five years after planting its one millionth hazelnut tree.

After revenue greater than $23.3 billion AUD last financial year, Ferrero, considered the world’s third-largest chocolate and confectionery company, has listed the Dellapool aggregation for sale.

Via Agri Australis and Waratah Land Pty Ltd, the global manufacturer of famous brands such as Nutella, Ferrero Rocher and Kinder Surprise expanded into Australia about 12 years ago.

As part of its southern hemisphere expansion, Ferrero purchased adjacent farms: the 1788ha Dellapool and 877ha Arrambee, on the banks of the Murrumbidgee River at Sandigo, east of Narrandera in 2011.

Since then, the company has aggregated the two properties, acquired a 11,361ML water entitlements portfolio and installed expansive irrigation infrastructure.

Now more than a decade later, Ferrero is selling the aggregation where it is expected to attract significant institutional interest with offers worth in excess of $80 million.

Ferrero is selling its former hazelnut farms near Narrandera in the northern NSW Riverina.

It is understood Ferrero is reducing hazelnut production to focus capital elsewhere in the supply chain, instead opting purchase hazelnuts from growers around the world.

CBRE’s John Harrison, James Auty and Matt Childs are handling the sale of the Dellapool aggregation with expressions of interest closing November 23.

“This is a unique opportunity in an attractive agricultural region that is appealing to corporate and institutional investors – particularly for large scale development assets with extensive river frontage and significant water entitlements,” Mr Harrison said.

Claudio Cavallini, CEO of Ferrero Australia in 2018.

“The Dellapool aggregation has been extensively developed with state of the art irrigation infrastructure, enabling flexibility in the potential production of various permanent horticulture plantings.”

Dellapool was formerly owned by large-scale potato farmers Jason Menegazzo and family, running the property with irrigated and dryland cropping, including 660ha of flood irrigation and 610ha under centre pivots.

Located about 14km southeast of Narrandera, the portfolio now offers about 1950ha of serviced irrigation land suitable for permanent plantings.

The farmland will be offered bare, as Ferrero removes its existing hazelnut plantations.

Of the 11,361ML, 2723ML are Murrumbidgee Regulated River (High Security) and 4,627.50ML are Murrumbidgee Regulated River (General Security).

Water entitlements and storage are key assets at Ferrero’s Riverina farms.

There are also 167.50ML of Murrumbidgee Regulated River (Supplementary), 3,815ML of Mid Murrumbidgee Zone 3 Groundwater and 28ML of Murrumbidgee Regulated River (Stock and Domestic).

On-farm water storage is more than 500ML while there is also extensive structural developments including offices, residential accommodation and multipurpose agricultural shedding.

In 2016, Ferrero’s Riverina hazelnut project had planted 415,000 hazelnut trees, planted their one millionth in August 2018.

Ferrero was established in 1946 in the Piedmont region of northwest Italy by Pietro Ferrero, launching the famous Nutella product in 1964.