Diversified Australian business SunRice Group is lined up to purchase the local pet-food company SavourLife.
Leeton, New South Wales-based SunRice said it has entered an agreement to acquire dog food and treats maker SavourLife in Sydney for A$20.3m ($13.4m), a deal that is expected to close by the 30 August.
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SavourLife founders Michael and Kimberlee McTeigue will remain with the business post-transaction, along with all its employees.
SunRice already has a presence in pet food with its branded CopRice division, which also supplies animal feeds for pigs, sheep, goats and horses. SavourLife will sit within that business.
CEO Paul Serra, who took the helm last year, said: “This acquisition positions our CopRice business to further expand into the branded companion animal market, where we’ve seen growing demand for premium products.
“The acquisition will use CopRice’s existing manufacturing facilities and supply chain to improve efficiencies and provide future growth opportunities.”
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By GlobalDataSavourLife generated revenue of A$33.4m in the year to 30 April 2024 and EBITDA of around A$2.8m, Sydney-listed SunRice said in a stock exchange filing. It added that it will fund the acquisition from cash reserves and debt facilities.
Prior to the deal agreement, SunRice was already manufacturing SavourLife’s branded dog food range, which includes wet and raw varieties, along with grain free. The products are distributed across Australia.
Co-founder Michael McTeigue said: “I am excited by the opportunity for CopRice to help continue to grow the SavourLife business, which will expand our ability to deliver on our mission.
“CopRice has been an important partner in building SavourLife into the business it is today, and I know that together we will build an even greater business into the future.”
SunRice said it will continue SavourLife’s mission of donating 50% of profits to dog rescue organisations.
The listed business started out supplying rice and rice snacks but has diversified through M&A, with acquisitions such as Trukai in Papua New Guinea last year and SunFoods in 2016.
It also owns Riviana Foods, which supplies products such as bakery, pickles and soup, and houses the brands Always Fresh, Toscano, Hart & Soul, Fehlbergs and Bare Bakers.
SunRice delivered revenue of A$1.6bn in the 12 months to 30 April 2023, an increase of 22.8%. EBITDA climbed 28% to A$117m, with profit after tax up 12.4% at A$54.8m. Earnings per share rose 9% to 83.8 cents.
In the new half year, revenue increased 21.2% to A$918.7m, while EBITDA climbed 48% to A$63.3m. Profit after tax rose 56.3% to A$30.5m, with EPS up 28.3% at 46.9 cents.
