Share
- Release Date: 22/05/14 11:33
- Summary: ASSET: CVT: Comvita to acquire New Zealand Honey Limited
- Price Sensitive: No
- Download Document 2.88KB
CVT
22/05/2014 09:33
ASSET
REL: 0933 HRS Comvita Limited
ASSET: CVT: Comvita to acquire New Zealand Honey Limited
Global natural health products company Comvita (NZX: CVT) has signed a sale
and purchase agreement to acquire all the shares of New Zealand Honey Limited
from New Zealand Honey Producers Co-Operative Limited. This is conditional
only on the approval by special resolution of the shareholders of New Zealand
Honey Producers Co-Operative Limited. The acquisition of New Zealand Honey
Limited comprises all of the assets of the Company including land and honey
processing assets in Timaru, honey inventory at settlement and a long term
honey supply agreement with New Zealand Honey Producers Co-Operative Limited.
New Zealand Honey Limited produces and sells products under the well
recognised brands, Hollands Honey, 3 Bees and Sweet Meadow. It also is one of
the largest exporters of New Zealand honey products. Total sales in 2013 were
$27.3 million.
The New Zealand Honey Producers Co-Operative, based in Timaru, was
established in 1981 and has grown to become one of the leading suppliers of
honey products in New Zealand. The Co-Operative is owned by 70 beekeeper
shareholders with the majority located in the South Island of New Zealand.
Comvita's CEO, Brett Hewlett said, "This acquisition goes a long way to
address the supply constraints that have been challenging Comvita in recent
years. We also gain valuable production capacity and additional company
exposure in the South Island. Historically, Comvita has sourced honey
predominantly from the North Island."
"By purchasing New Zealand Honey Limited and partnering with New Zealand
Honey Producers Co-Operative, we are able to combine export initiatives and
leverage Comvita's international distribution and premium brand image. This
acquisition is going to create lasting value for the shareholders of both
Companies."
New Zealand Honey Producers Co-Operative's Chairman Barney Sundstrum said,
"Like Comvita, we have long held the view that there was merit in
consolidating manufacturing and marketing functions in the honey industry to
achieve economies of scale."
"The proposed transaction with Comvita ticks all the relevant boxes, giving
existing and future Co-Operative members greater exposure to the benefits of
premium markets and is unanimously endorsed by the Board ahead of the
forthcoming Special Meeting."
The purchase price is $12.3 million, subject to a working capital adjustment.
The purchase price shall be payable with $7.3 million in cash and $5 million
in Comvita shares issued at $3.50 per share. The Comvita shares are to be
held in Escrow and released to New Zealand Honey Producers Co-Operative
annually, over a six year period.
The acquisition is expected to be earnings accretive per share for Comvita's
shareholders and is anticipated to be completed mid-June, 2014.
End CA:00250737 For:CVT Type:ASSET Time:2014-05-22 09:33:00
