Tuesday 9th September 2014
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Veritas Investments, which owns the Mad Butcher franchise business, has bought upmarket grocery chain Nosh Food Market for $1.77 million.
The Auckland-based company completed the deal after all conditions, including Nosh shareholder approval, were satisfied, it said in a statement. The purchase price was about $1 million below net tangible assets, with $500,000 retained for 90 days until the balance sheet is verified. Veritas has met all of Nosh's trade creditors, but hasn't assumed any of the grocery chain's debt.
The deal and expected working capital requirements will be funded by a $5 million facility with ANZ Bank.
"We are delighted to have Nosh under the Veritas umbrella and excited about the huge potential of the business," chairman Mark Darrow said.
This is the third acquisition for Veritas in the past 16 months, after it bought the Mad Butcher business in May 2013 in what was effectively a reverse listing, having sold its assets and returned capital to shareholders.
The NZX-listed investment company, which focuses on the food and beverages sector, bought half of Kiwi Pacific Foods in December for $2.8 million in cash and $400,000 in shares at $1.38 apiece, with potential earn-outs if certain export targets are met. The remainder of the business is owned by Antares Restaurant Group, which holds the New Zealand Burger King franchise.
Mad Butcher chief executive and Veritas director Michael Morton will manage Nosh while the company searches for a permanent executive.
Shares of Veritas fell 0.9 percent to $1.10 yesterday, and have dropped 21 percent this year. That values the company at $41.1 million.
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