Wednesday 31st August 2016
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Seeka Kiwifruit Industries, which handled record volumes of fruit in its latest packing season, is moving up the value chain by acquiring the Kiwi Crush and Kiwi Crushies product ranges from Auckland-based Vital Food Processors for an undisclosed sum.
Kiwi Crush is a range of kiwifruit based drinks marketed for digestive complaints such as constipation and for the benefits of their vitamin C and antioxidants. The Kiwi Crushies range of fruit-based ice blocks was launched in 2014.
Chief executive Michael Franks said the company wasn't required to disclose the purchase price given it was relatively small relative to the size of the business. "This is about total value recovery - getting more value from the produce that we're handling," he said.
Seeka, the largest kiwifruit grower in New Zealand and Australia, was on the lookout for other potential value-added assets it could acquire, "when it fits into the core business."
Seeka listed in 2003. In recent years it has added SeekaFresh, which handles non-Zespri supplied produce including avocados, and Glassfields, which imports and ripens tropical fruit and provides a logistics service for retailers. It produces avocado oil that is sold under the Village Press brand.
Franks said Seeka has a long association with Vital Foods as a supplier of kiwifruit and as a shareholder. Seeka owns 2.3 percent of Vital, according to Companies Office records.
Seeka said the products would initially continue to be manufactured by Vital but that Seeka plans to establish a food technology and processing centre in the Bay Of Plenty in time for the next kiwifruit season, focussed on adding value to the products it handles.
The company's New Zealand volumes rose 17 percent to 30.8 million trays in the 2016 season, exceeding 30 million for the first time. Last week it said first-half profit almost doubled to $7.1 million.
Its shares last traded at $4.40 and have gained 27 percent in the past 12 months.
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