Ebro upbeat on acquisition prospects

Ebro upbeat on acquisition prospects

Ebro Foods' two planned acquisitions in the rice sector will be a "new step forward" for the Spanish food group, the company's chairman and CEO has insisted.

Antonio Hernandez Callejas said Ebro's moves to buy Australian rice processor Ricegrowers and the rice assets of fellow Spanish food maker SOS Corporacion Alimentaria - deals that are both yet to be finalised - would benefit the business.

Speaking at the Consumer Analyst Group Europe (CAGE) conference in London yesterday (28 March), Callejas said Ricegrowers, which trades as SunRice, was a strong business.

"SunRice is a very powerful business which is very complimentary to us," Callejas said.

Ebro announced its move to acquire SunRice in November in a A$600m (US$613.8m) deal. However, the transaction remains subject to approval by the SunRice shareholders. Last month, SunRice said Ebro had improved its offer through a guarantee to buy all the medium-grain rice grown in Australia at the benchmark price of California rice for seven years, up from five previously.

SunRice shareholders will vote in May on whether to accept Ebro's offer.

Callejas, meanwhile, said Ebro's move to buy SOS's rice assets was set to be "completely finalised" this week.

The company has also moved to take a 10% stake in SOS for EUR50m, an investment that Callejas said would give Ebro the ability to "look and see" how the olive oil sector develops.

The core business of SOS, which has undergone restructuring as the group has looked to boost profits and focus on core activities over the last two years, is in olive oil and brands including Bertolli and Carbonell.

Ebro is focused on rice and pasta but Callejas said the company is looking to grow its presence in adjacent categories like pasta sauces. The Ebro chief also said the company was looking to branch out into areas like ready meals and frozen foods.