TASFOODS has settled a legal dispute with the owners of Woolnorth over its failed bid to buy the country's largest holding of dairying properties in Circular Head.
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In a statement to the ASX on Friday, TasFoods announced it had reached a settlement agreement with the current owner of Van Diemen's Land Company, New Plymouth District Council of New Zealand. The settlement gives TasFoods cash compensation of $1.25 million
In the statement, the company said due to the "uncertainty that has arisen in relation to the proposed capital raising to fund the acquisition of the assets of the Van Diemens Land Company" the board of directors had decided the "agreement to acquire VDL had diminished".
The company said despite a belief that its case was sound, the board was conscious that continuing with litigation would lead to considerable costs and management time that could be better spent elsewhere.
TasFoods took NPDC to court for compensation after its bid to buy VDL was rejected.
TasFoods was initially announced as the winning bidder in the sale of VDL for $250 million at the beginning of November.
However, by late November, NPDC announced it had been negotiating with a separate company, Chinese-owned Moon Lake Investment, and that Moon Lake would purchase VDL instead for $280 million.
TasFoods later sought an injunction on the sale but this was overturned.
Chinese investor Lu Xianfeng, the sole operator of Moon Lake investment will buy the company subject to a decision by the Foreign Investment Review Board, which is expected to announce their decision at the end of the month.
