Origin Enterprises plc
to acquire Masstock Group Holdings for Stg£26.3m
Origin Enterprises
plc, the 2007 spinoff of foods' group IAWS, today announced that it
has reached agreement to acquire Masstock Group Holdings Limited.
Masstock,
with operations in the United Kingdom and Poland, and formerly a
large dairy processing operation in Saudi Arabia, is a leading
provider of specialist agronomy services directly to arable and
grassland farm enterprises. Masstock, which has been synonymous with
the development of state-of-the art farming systems throughout the
world, was established in the 1970's through the vision of two
leading Irish entrepreneurs Paddy and Alistair McGuckian.
The initial consideration for the
equity share capital of Masstock will be Stg£26.3m. Deferred
consideration of up to Stg£10m will be payable based on the
achievement of profit targets over the period to July 2012. Masstock
generated a turnover of Stg£250.6m for the year ending 30 June 2007
and operating profit before non recurring items and goodwill
amortisation amounted to Stg£6.8m. Masstock had net tangible assets
of Stg£23.6m at 30 June 2007 and net debt of Stg£30.6m.
The acquisition is being funded by
additional bank facilities. It is expected that the acquisition will
be earnings enhancing for Origin from the date of completion which
is expected in early February 2008.
The existing
management team led by Declan Giblin as Group CEO, David Cribbin as
Managing Director for the UK business and Graham Harris as Managing
Director of the Polish business, who have been responsible for the
development of Masstock over the past twenty years will be remaining
with the Group.
Commenting on the acquisition, Tom O'Mahony, Chief Executive of
Origin said: "Masstock
provides system-based solutions directly to over 10,000 farm
businesses throughout the United Kingdom and Poland. This leading
approach delivers a fully integrated production system, based on a
superior research and on-farm agronomy management. The business
combines an extensive arable research and development capability
with a major sales, marketing and distribution focus, delivering a
superior advisory and inputs offering to leading growers. The
service encompasses varietal selection, nutrition, crop protection
and application techniques necessary to ensure high performing
marketable crops, which adhere to the highest levels of safety,
quality, sustainability and environmental requirements."
"The acquisition of Masstock
significantly enhances Origin's capability to support primary food
production. The structural shifts taking place globally in the form
of rising food demand and an increased awareness of agriculture as
an alternative supplier of energy is placing an enormous focus on
best farming practice and soil protection techniques required to
deliver sustainable productivity. Masstock has the capability,
expertise and proven ability to respond to this changing dynamic
which combined with the geographical spread of its business presents
a new exciting growth opportunity for Origin."
Commenting on the transaction, Masstock Group CEO, Declan Giblin
said: "The
acquisition represents an important milestone in the development of
Masstock. We will become an integral part of a leading organisation
focussed on the value added and primary sectors of the food industry
enabling us to leverage a combined capability within an exciting
market environment."
