Collapse costs couple $4.5m

Collapse costs couple $4.5m


Business
Former Henbury Station owners Sally Williams and Ross Morton have lost $4.5 million following the collapse of R.M. Williams Agricultural Holdings.

Former Henbury Station owners Sally Williams and Ross Morton have lost $4.5 million following the collapse of R.M. Williams Agricultural Holdings.

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The future of Henbury Station - once labelled the future for carbon farming - remains up in the air following the collapse of its corporate owners R.M.Williams Agricultural Holdings.

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BIG players like News Corporation and London Stock Exchange-listed private equity invesment company Origo Partners haven't been the only ones hit in the collapse of R.M.Williams Agricultural Holdings (RMWAH).

Ross Morton and Sally Williams have also said goodbye to $4.5 million.

In 2011 they decided to sell their 519,000-hectare Central Australian station "Henbury", located some 125 kilometres south of Alice Springs, to RMWAH.

The deal - $13 million for the expansive station bare of stock and $500,000 for improvements - was comprised of $9.1m from the Commonwealth government and $4.5m from RMWAH.

However, while Mr Morton and Ms Williams received $9m upon settlement in June 2011, the $4.5m from RMWAH came in the form of 4.5m shares - worth $1 each - in the company as opposed to cash.

The couple say they did not know the Commonwealth had contributed funds to the purchase of "Henbury" - or the fact it was going to be destocked permanently for a carbon project - until after they agreed to the sale.

The couple had an option to sell their RMWAH shares last July, however, when they approached the company it did not have the funds to make the purchase.

As a result they agreed to extend the period by a further 12 months - with interest - due to be paid last month.

Instead, they now own 4.5m worthless shares in a failed company following the appointment of PPB Advisory of RMWAH in June.

"'Henbury' was our life; 30 years there is a long time. It's the first big deal we've ever done and it's gone ass-over-head," Mr Morton said.

"Because we're a shareholder there is nothing we can do. It's a fair kick in the guts."

Mr Morton claimed RMWAH had effectively not paid any money for the property which he and Ms Williams poured their heart and soul into since moving there after the family partnerthip were involved in purchased the station in 1982.

The $9m payment in 2011 allowed the couple to retire debt and purchase a new home; the 424ha "Mt Annan" near Holbrook, which they use to run about 350 Angus breeders.

They have also owned the 8500ha "Delta" at Jerilderie since 2001 which had been used to finish stock from Henbury Station and now runs about 1200 Shorthorn and Santa Gertrudis-cross breeders.

Before moving to Holbrook permanently, Ms Morton and Ms Williams took a year to destock the more-than 15,000 head of cattle left on Henbury Station.

They still have about 650 breeders - the last of the cattle from "Henbury" - on agistment on a property near Ivanhoe.

While Ms Williams is pragmatic about the loss, it doesn't stop it from hurting any less.

"Ultimately we took a risk and we lost. We wanted to sell, we sold to them on their terms and it didn't work."

Where to from here

The future of Henbury Station - once labelled the future for carbon farming - remains up in the air following the collapse RMWAH.

Since the initial June appointment of PPB Advisory, three of the main RMWAH subsidiaries - the Northern Territory beef operations, the organic sheep, cattle and cropping country in south-west Queensland and also the organic free-range poultry business, Inglewood Farms - have followed the holdings company into receivership.

However, Henbury Station has remained out of the hands of the receivers.

Last month a spokesman for new federal Environment Minister Mark Butler said the Department of Environment was "monitoring developments and considering what this means for the long-term conservation management of the property".

Northern Territory Cattlemen's Association executive director Luke Bowen said the carbon farming methodology used as the basis for destocking the property after its purchase by RMWAH in 2011 was untested.

"It's really disappointing," he said.

"We knew enough about the carbon market and also about the science behind the carbon offset program.

"We knew it was absolute nonsense that was being cooked up and used to try and sell this idea that there would be rivers of gold flowing back into one, RMWAH, and two, the broader industry."

Mr Bowen said former RMWAH managing director David Pearse - who left the company last September - described his plan for Henbury Station to NT pastoralists as "gourmet carbon" farming.

"Gourmet carbon was a combination of carbon credits, of biodiversity, of social credits and you pull all of these things together, throw them all in a little box and put a golden wrapping around it," Mr Bowen said.

"You then flog it to some unsuspecting polluter from America or Germany for $100 and then when they actually open it up and have a look inside there is probably about $3 worth of gear in there.

"None of it stacked up."

Mr Bowen said local landholders had tried to make their concerns known at the time.

"It's not as if we were sitting there idly by not ringing any alarm bells, we were – and being told we were fools as a result."

Last July Qantas signed a deal to purchase up to 1.5 million carbon offset credits from Henbury Station across five years, but the airline now says the deal was not binding.

Alice Springs stock and station agent Jock McPherson had the joint listing on Henbury Station with Elders, until Elders eventually ended up seeing through the deal with RMWAH.

Mr McPherson - who co-owns Territory Rural McPherson with Ruralco - said the station, with more than 80 kilometres double frontage on the Finke River, was one of the most productive south of Alice Springs.

While he said the destocking of the property may have actually had a positive influence on the local cattle market, it was disappointing such a productive property was out of production.

"It's certainly one of the better places in Central Australia," he said.

"It just doesn't seem to have a future the way it's being held at the moment. The carbon model obviously hasn't worked. What are they going to do with it?

"It just seems a waste of prominent and better-quality pastoral country.

"There are people that have showed interest and verbally stated they would certainly like to have the opportunity to purchase the property and put it back into cattle production."

Fellow Central Australian pastoralist Rebecca Cadzow - who owns Mt Riddock Station with husband Steven, some 400km from "Henbury" - said the longer the property remained out of agricultural production, the more it would become a haven for feral animals and a fire risk.

"It's a magnificent holding and it's a large part of the pastoral industry of Central Australia," she said.

"It's a big mass of land that's just unoccupied and not utilised at the moment.

"We lost a major player in the cattle industry here in Central Australia when it went to carbon trading and not cattle farming."

RMWAH was contacted for comment.

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