Rural Funds Group (ASX:RFF)
has negotiated a lease to develop and operate an almond orchard in the Riverina district of New South Wales.
The deal with Olam Orchards Australia is conditional on Rural Funds spending around $19 million to acquire two properties in the Darlington Point area. It is also subject to Olam winning Foreign Investment Review Board approval for the scheme.
The plan is for a 22-year-lease to Olam Orchards with Rural Funds to supply water for the planting and as the orchard matures.
An initial 1,500 hectares will be planted to almonds in 2016 at a cost of around $109 million with potential total plantings of around 2,500 hectares later on.
Rural Funds reported a net profit of $10.15 million for the 2015 financial year.