2 Feb 2016 07:00
Total Produce plc
Stock Exchange Announcement
Total Produce acquires 65% of leading California Produce Company
Total Produce plc, the leading fresh produce company, is pleased to announce that it has acquired a 65% equity stake in Progressive Produce LLC, headquartered in Los Angeles, California. Progressive Produce is a grower, packer and distributor of conventional and organic produce to the retail, wholesale and foodservice sectors in the U.S. and Canada.
Progressive Produce was founded in 1967 and today is one of California's premier produce companies with 2015 sales in excess of US$ 200 million, gross assets of c. US$36m at 31 December 2015 and employing 214 people.
Progressive Produce offers a wide range of fresh, domestic, local and imported produce and specialises in the year round supply of potatoes, onions, asparagus, organics and other fresh fruits and vegetables. The business serves its customers from four strategically located distribution facilities in California and Washington.
The purchase consideration will be satisfied by an initial payment on closing. In addition, a further payment will be made in 2019 contingent on the achievement of future profit targets. Total Produce expects the investment to be earnings enhancing from the date of closing. Long term put and call options are in place for the remaining 35%.
Jim Leimkuhler (President), Victor Rodarte (Vice President) and Jack Gyben (Vice President) will remain as equity holders of the business and will continue to be key members of the executive management team.
Commenting on the transaction, Carl McCann, Chairman of Total Produce said:
"We are delighted to become co-owners in Progressive Produce. This transaction with a leading California produce company further broadens our US operations and is in line with our strategy. We look forward to working with the excellent people in Progressive Produce as it continues to develop its very successful business expansion in future years."
Commenting on the transaction, Jim Leimkuhler President of Progressive Produce said:
"We are very pleased and excited to join with Total Produce. This transaction will further strengthen the business we have developed and grown over many years. We believe this is an excellent long-term combination of skills and expertise that will benefit all stakeholders, including our growers, our suppliers, our people and our customers."
CREO Capital Advisors, LLC acted as financial advisor and Liner LLP acted as legal and tax counsel to Progressive and its members. KPMG acted as financial and tax advisor and Gibson Dunn & Crutcher LLP acted as legal counsel to Total Produce.
2nd February 2016
For further information, please contact:
Brian Bell, Wilson Hartnell PR
Tel: +353-1-669 0030
Ivan Murphy, Davy Corporate Finance
Tel: +353-1-679 6363