Australia’s So Natural Foods has said it is in an advanced stage of negotiation for the potential acquisition of an ambient seafood business to build on the Paramount seafood business acquired in 2003.
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The acquisition, which is subject to due diligence and board approvals, is expected to be earnings-per-share positive immediately after the acquisition. It is to be mainly financed from the funds released from a beverage manufacturing joint venture transaction, which was announced at the same time.
So Natural Foods (SNF) said it had entered into an agreement to establish a manufacturing joint venture for the soy and rice, dairy milk and associated beverage contract manufacturing activities currently conducted at the company’s Taren Point site. The 50:50 joint venture with Leppington Pastoral Company, a New South Wales dairy milk producer, will acquire SNF’s manufacturing plant and equipment at Taren Point.
The company described the transaction, which is expected to be completed by March 2005, as an “important strategic initiative” for SNF.
“The development of the manufacturing joint venture in conjunction with a partner with growth ambitions in dairy and other beverages should result in a competitive cost base for the soy and rice business in the medium term, and provide opportunity to expand our brand portfolio,” SNF said.
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