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Further kiwifruit consolidation likely as Satara, Seeka shares halted

Monday 8th November 2010

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The trading halt on Satara Cooperative and Seeka Kiwifruit Industries shares is likely to herald an announcement of further consolidation among major kiwifruit growers, according to market commentators.

Satara, New Zealand’s largest kiwifruit grower, and Seeka, the avocado and kiwifruit grower and post-harvesting operator, have had their shares suspended on the NZX today pending a material announcement from both companies, which is expected at the end of the day.

The two have been active in growing their fruit production and handling capacity in recent years.

In August, Satara announced a merger with EastPack to form a wholly grower-owned company, with further details on the deal expected in mid-November. Last year, Seeka successfully bought fruit packaging company Te Awanui Huka Pak for $24.2 million, which lifted its processing capacity to 26 million trays.

“There has been quite a lot of consolidation in the kiwifruit market, so on the surface it does seem to look like an alliance is taking place,” said Bryon Burke, head dealer at Craigs Investment Partners.

The two companies jointly own a 45% stake in Paengaroa-based pre-packing business Kiwi Produce, which they acquired in 2006.

The trading halt comes on the day that MAF Biosecurity New Zealand announced it had launched an investigation into an alleged outbreak of the Pseudomonas syringae pv actinidiae disease on kiwifruit vines on a North Island orchard.

It is understood that the Satara and Seeka announcements are not related to this development.

 

Businesswire.co.nz



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