F&A Dashboard - InterFinancial

15 May 2015
Food & Agribusiness
Pricing Multiples
Forward Price Earnings Multiples (monthly to 30.04.15) 1 Source: S&P Capital IQ
Multiples in the Food & Agribusiness (F&A) sector have increased over the period in contrast to a weaker market. At the end of April, the F&A sector
traded on a forward PE of 17.3x, in line with the ASX200 on 17.0x.
Average Values and Trading Multiples (as at 15.05.15) Source: S&P Capital IQ
Enterprise Value
EV/EBITDA
FY2015
EV/EBIT FY2015
Price / Earnings
FY2015
Food Processing
12,219
12.0x
16.0x
18.6x
Distillers and Vintners
3,897
10.0x
14.2x
18.5x
Agricultural Products
6,033
12.4x
17.7x
17.6x
101,546
12.0x
10.9x
14.1x
Subsector
Food Wholesale/Retail
Note: Multiples are based on the forward year of the unreported period. This is currently FY2015 for the majority of companies.
1
The InterFinancial F&A Index set is an unweighted index comprising F&A related companies trading on the Australian Securities Exchange (ASX).
Estimates are sourced from S&P Capital IQ.
Merger & Acquisition News…
•
Leppington Pastoral Company, the Australian dairy group owned by the Perich family, has partnered with Moxey Farms to form a consortium
named Australian Fresh Milk Holdings, with the objective of transforming Moxey into a major dairy farming business. China’s New Hope Dairy
and Freedom Foods are also members in the consortium which is expected to invest more than $80m.
•
Ridley Corporation has signed a contract to sell a former feedmill site for $3m. The buyer will pay 10% of consideration by way of deposit and the
balance upon completion.
•
Australian Dairy Farms Group has acquired 3 producing dairy farms in Victoria for approximately $16m. This acquisition is the first step for
Australian Dairy Farms’ plans to raise $41m to fund the acquisition of six Australian dairy farms in Victoria for a total value of $39m.
Chewing the Fat…
•
Blue Sky Alternative Investments is targeting the $1.9 trillion Australian superannuation industry with a new fund that will offer exposure to three
agricultural asset classes: mid-tier agri-infrastructure, agribusiness private equity and water entitlements. Australia’s local pension industry has
traditionally stayed away from agriculture investments but the company is confident the fund will attract commitments from other local funds.
•
Westchester Group, Laguna Bay Pastoral Company and Teachers Insurance and Annuity Association of America are believed to be among
the potential suitors for Select Harvests’ almond orchards which are up for sale. The offshore agriculture investors are believed to be in the running,
along with some local funds who are familiar with the sale-and-leaseback structure.
•
GrainCorp will invest $60m on 13 country site upgrades in 2015 as a part of the $200m to be spent over three years under Project Regeneration.
Project Regeneration involves developing a network of over 50 high capacity country sites to support an efficient rail operation which will reduce
rail costs by around $5 per tonne and return up to 1 million tonnes of grain to rail.
•
Tassal Group is believed to be advancing negotiations to acquire De Costi Seafoods.
•
Gunns’ receivers and managers are seeking expressions of interest to acquire 550 hectares of land suitable for industrial development and other
uses located in Bell Bay, Northern Tasmania.
•
Private equity players including Pacific Equity Partners have essentially been ruled out as buyers for Costa Group, the Australian fruit and
vegetable business due to the sellers’ price expectations. Costa’s owners, Paine & Partners and the Costa family, are believed to be seeking 10x
to 12x earnings for the business. Limited interest from potential buyers could prompt Costa Group to pursue a $1bn IPO.
•
MPDT Tree Service, a private family-owned Australian tree lopping and vegetation management company, will consider a sale that could facilitate
the next phase of the company growth, said Billy Quaid. The owners are also planning to focus on alternative businesses in the future, in particular
in the agricultural space.
•
The Chia Co, a private equity-back Australian grower and distributor of Chia seed products, is looking to enter china and welcomes approaches to
establish joint ventures locally, Managing Director John Foss said.
•
Macquarie’s Pastoral Fund, one of Australia’s largest landowners, could bid for S Kidman & Co, the Australian landowner. A private fundraising
by the Pastoral Fund has led to expectations that it could bid for S Kidman.
•
Byron Bay Chilli Company, a privately held Australian producer of jalapeño-based condiments and snacks, is actively seeking a partnership in
North America while identifying other global expansion opportunities, co-owner Murray Richardson said. A strategic investor would be considered
if it owned a manufacturing plant that would offer the benefit of lowered cost of production.
•
Greenland Group, a Chinese state-owned property developer, is in talks to acquire food manufacturers in Australia and New Zealand which it
could then inject into its newly-launched supermarket business, known as G-Super.
•
Odin Energy has executed a MoU to acquire The Hemp Corporation, via a SPV. THC controls the supply and procurement process of Hemp
from seed propagation, planting, harvesting, processing and distribution.
•
Avon Valley Beef, a family-owned and operated beef wholesale and retail business, is looking for a buyer and could sell the business in 2015,
founder Peter Hepple said. The owner prefers to sell the business to local buyers as he is determined to keep it Australia-owned.
•
Consolidated Pastoral, the Australian beef producer, is said to have sent sale documents to potential buyers in a stake sale process. Owners
Terra Firma is believed to be seeking a partner to provide an investment of $300m-$500m.
•
Archer Capital’s exit from Brownes Dairy is likely to be delayed as the Western Australia-based company’s new management builds a track
record.
Vita Coco, a privately-held New York-based coconut water company, is opportunistic about acquisitions, Chief Executive and co-founder Michael
Kirban said.
•
If you are interested in specific information regarding mergers and acquisitions in the Food & Agribusiness sector, please contact Paul Keehan
(pkeehan@interfinancial.com.au), David Hassum (dhassum@interfinancial.com.au), Brett Plant (bplant@interfinancial.com.au) or Mark Steinhardt
(msteinhardt@Interfinancial.com.au).
Senior Contact Details
Name
Position
Phone
Paul Keehan
Chairman
(07) 3218 9100
Email
pkeehan@interfinancial.com.au
Sharon Doyle
Managing Director
(07) 3218 9122
sdoyle@interfinancial.com.au
Brett Plant
Director
(07) 3218 9106
bplant@interfinancial.com.au
David Hassum
Director
(07) 3218 9108
dhassum@interfinancial.com.au
Ted Marchant
Director
(07) 3218 9113
tmarchant@interfinancial.com.au
Andrew Wheeler
Director
(07) 3218 9107
awheeler@interfinancial.com.au
Mark Steinhardt
Associate Director
(07) 3218 9105
msteinhardt@interfinancial.com.au
Hyun-ju Johnson
Associate Director
(07) 3218 9109
hjohnson@interfinancial.com.au
Maree Klemm
Consultant
(07) 3218 9107
mklemm@interfinancial.com.au
Anna Grant
Consultant
(07) 3218 9112
agrant@interfinancial.com.au
This information has been sourced from the ASX, Mergermarket.com and various other public information sources. Forecasts are consensus forecasts
sourced from S&P Capital IQ.
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particular needs and investment objectives, a financial services licensee or investment adviser should be consulted before any investment decision is made. While this
document is based on information from sources which are considered reliable, InterFinancial, its directors, employees and consultants do not represent, warrant or
guarantee, expressly or impliedly, that the information contained in this document is complete or accurate. Nor does InterFinancial accept any responsibility to inform you of
any matter that subsequently comes to notice, which may affect any of the information contained in this document. This document is a private communication to clients and
is not intended for public circulation or for the use of any third party, without the prior approval of InterFinancial. This report does not constitute advice to any person.
Disclosure. InterFinancial has no interest in any of the securities mentioned in this publication. However, its directors, executives or consultants may have an interest in
some of the securities, directly or indirectly, which are mentioned