Rural Funds Group (ASX: RFF) announced today, 10 July 2026, that contracts have been exchanged for the sale of five agricultural assets for a combined value of $255.6 million. This figure represents an average 22.7% premium compared to their book values as of 31 December 2025. Rural Funds Group is an agricultural Real Estate Investment Trust (REIT) listed on the ASX, owning a diversified portfolio of Australian agricultural assets with a strategy to generate capital growth and income from developing and leasing them. The assets sold include four cattle properties – Rewan, Cobungra, Wyseby, and Cerberus – along with a 2,500 ML New South Wales river water entitlement, which collectively held a prior book value of $208.3 million.
Rural Funds Management Limited (RFM), as the responsible entity, stated that these asset sales align with RFF’s strategy to dispose of assets, aiming to reduce gearing to within its target range of 30-35%. The proceeds from these sales will be initially applied to RFF’s core debt facility. Following these transactions, pro forma gearing is projected to decrease to 31.6% from 39.1% recorded on 31 December 2025. Furthermore, the asset sales satisfy a condition precedent to increase the Guarantee to J&F Australia Pty Ltd from $160.0 million to $200.0 million, when required by JBS, although the Guarantee currently remains at $160.0 million.
While Foreign Investment Review Board approval is still required for the purchase of Cobungra, all other asset sales are unconditional. Settlements for these transactions are predominantly expected to occur in the first half of calendar year 2027. Upon settlement, these transactions are anticipated to deliver a net benefit to RFF’s adjusted funds from operations (AFFO). The company has reaffirmed its forecast AFFO for the 2026 financial year at 11.7 cents per unit.
