Media release
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Wednesday 22nd December 2004 |
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Bridgecool, a significant post harvest business packs over 4.5m trays of Kiwifruit along with a successful and growing avocado business adds a significant volume to Seeka's expanding business base.
The transaction is the third recent investment by Seeka which has successfully completed the amalgamation of Eleos Limited, along with acquiring a 20% stake in Opotiki Packing and Coolstorage Limited (OPAC). The combined investments consolidate Seeka's processing capacity in the Kiwifruit Industry to just on 25 million trays representing approximately 30% of the industry. The combined group's total assets will exceed $90 million.
The Bridgecool operations, centered in Tauranga and Katikati, draw fruit from as far away as South Auckland and add a new geographical mix to the Seeka supply base. Bridegecool has high quality assets and recently invested in colour computer blemish grading systems similar to those operated by Seeka. The marketing interests of Bridgecool under the brand "Global Fresh" are excluded from the acquisition.
Under the deal, Mark Yortt, current Bridgecool managing director and shareholder will stay on for 12 months to assist in the transition of the Company.
The combined group is expected to offer significant future benefits to shareholders through positive earnings growth and efficiencies of scale. Grower suppliers to all contributing Companies will also benefit from rationalization of supply chain costs and a focus on delivery of improved financial benefits to growers.
Tony de Farias, Seeka Managing Director,said that the transaction comprised a very significant step in consolidation of the kiwifruit post-harvest sector. He confirmed that the investment made a lot of commercial sense for Seeka and the industry. He said that Bridgecool has good assets, good management and strong links with growers and orchards managed and leased by the company. Seeka's considerable resources and support will enable Bridgecool to reinforce its position as the pre-eminent Kiwifruit Post Harvest business in the Western BOP.
De Farias said that he now looked forward to focusing on delivering the full value potential to Seeka's shareholders and growers.
He stated that the opportunities had arisen relatively quickly and that their resolution had required the use of bridging finance facilities. However the company is planning an equity raising program in the new year along with other measures aimed at bringing the financial structure into line with appropriate ratios. A full NZX listing will also be considered and a meeting of Shareholders planned for February 2005.
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