Paternal loyalty motivates dairy unit sale - with two sons joining their father in new 'mega-farm'

A dairy farmer and father passionate about continuing decades of family farming history is selling his dairying unit and using the proceeds help fund his two sons into a new joint venture ‘mega farm’.

Bay of Plenty dairy farmer Tony de Groot has been running his 169 hectare farm for almost a decade. But with two equally-capable adult-aged sons ready to step into his gumboot steps, and Tony looking to move onto a larger farm, he was torn over which son would be the most worthy successor.

So instead of ‘playing favourite’ and allowing one son to take over running the farm ahead of the other, Tony has decided to sell up the  land and use the proceeds to go into a joint venture partnership with his two boys Michael and John – both of whom are passionate about continuing their career futures ‘on the land’.

“It wasn’t an easy decision to make, but it seemed the fairest way to pass on a family legacy. This way the boys both get a foot up the farming ladder which will enable them to either grow their share milking herds, or eventually buy their own farms,” said Tony.

“Both the boys are excellent farmers and I would trust either of them in taking over my unit and running it well. Other than tossing a coin for one of the boys buying out the other, the fairest way farm was to sell my farm and buy a bigger one which could sustain three herds.”

The Eastern Bay of Plenty property Tony is selling has a capital valuation of $4.256million and is being sold with 173,398 Fonterra shares.

The fertile and highly productive property is being marketed for sale by negotiation through leading real estate agency Bayleys. Sales person Rhys Mischefski said it was the first time he had ever seen a family dynasty being so evenly divided.

“I’ve seen plenty of examples before where one son has bought the other out of their father’s operation, but not where the patriach has merged three business units into one. It’s certainly going to be sizeable farming operation,” Mr Mischefski said.

“With so much speculation over the long term future of dairy farm ownership, particularly on a large scale, it’s heartening to see Tony securing his sons’ futures. This is just the sort of initiative which means that sustainable New Zealand farm ownership will continue for generations to come.

“After three generations in the Eastern Bay of Plenty, Tony de Groot and his boys are well known in the local community, and there has been plenty of talk about who would take over the farm…. and where Tony will relocate to – bearing in mind the size of the new family ‘mega farm’,” Mr Mischefski said.

Tony de Groot’s father immigrated from Holland at the end of World War II and began his life on the land as a farm labourer in Opotiki before he bought his own farm. Tony’s current milking herd is directly descended from those cows raised in Opotiki during the 1950s.

Mr Mischefski said the farm currently milked 400 cows through a 36-aside shed serviced by a 200 cow concrete feed pad and a well developed race system. In addition to the diary revenues generated, the farm is paid annual royalties for the extraction of river stones from the property.

The property also contains four houses. The main homestead is a two-storied six-bedroom dwelling where both John and Michael have lived. The two workers’ homes are three-bedroom residences, while the fourth premises is a small weatherboard house rented for $100 a week.

Paddocks on the farm are irrigated through a bore. Mr Mischefski said a comprehensive fertiliser history for the property was available, as well as recent soil test analysis.

Approximately 160 tonnes of dry maize silage is grown on the farm annually. In the 2010/2011 year, some 180 tonnes of palm kernel was brought in. Effluent is pumped across 20 hectares of the farm via a GPS monitoring system. A majority of the 55 paddocks are subdivided with posts and two wire electric fencing.

Mr Mischefski said a 400 tonne concrete silage bunker has just been built on the farm, while the property also had a number of rural support buildings such as machinery garaging shed, and a calving shed.