- Attractive aggregate purchase price of approximately $20.5 million (subject to adjustment), representing an acquisition multiple of 5.6x FY17 forecast incremental EBITDA.
- Purchase price to be funded entirely from cash and debt.
- Delivers an expected increase in Scales’ earnings per share of approximately 4% in FY17.
- Further profit uplift through to 2020 as post-harvest capacity is fully utilised.
- Consolidation of a fully integrated grower, packer, and marketer of apples in the Hawke’s Bay handling approximately 530,000 TCEs annually.
- Extends Scales’ total managed orchard by ~115 ha, of which 85 ha is planted.
- High quality management team.
- Complementary near market focus.
- Compelling synergies including immediate access to modern post-harvest capacity, and strong revenue and cost synergies.
Scales Corporation Limited (NZX:SCL) on Thursday announced that it has entered into an agreement, through its wholly owned subsidiary Mr Apple New Zealand Limited (Mr Apple) to acquire 100% of the shares in Longview Group Holdings Limited (Longview), a standalone Hawke’s Bay grower, packer, and marketer of apples. Longview leases 76 ha of orchard and bare land under long term leases. The transaction also includes the purchase of 22 ha of orchard immediately surrounding the Longview packhouse and coolstore and a lease of a further 17 ha of orchard from parties associated with Longview shareholders (collectively the Transaction). Key highlights of the Transaction include: