Thursday, October 03, 2024

SPC, Original Juice Company and Nature One Dairy to merge shoring up iconic Australian food brands' future



The Merger 


Iconic fruit and vegetable manufacturer SPC started over 100 years ago  and acquired from CocaCola-Amatll by a consortium led by Hussein Rifai’s Perpetuity Capital in 2019 - for $45m,  has agreed to merge with the Original Juice Company(OJC) and the powdered milk business, Nature One Dairy. 


SPC shareholders will have 69 per cent of the new company, Original Juice Co shareholders 15.5 per cent, and Nature One Dairy shareholders will have 15.3 per cent.


OJC is currently listed at $50m (one times revenue ) implying a merged value at circa $333m. 


The Projection and the opportunity 


The combined businesses are expected to deliver more than $400 million in revenue in the next financial year - and with economies of scale is expected to make a profit of $29m in 2025 and grow from strength to strength says Rifai.


“We want to become the Nestle of Australia. We want to become a global player in the food industry out of Australia,”


It’s interesting to note that CCA acquired SPC for $759m in 2005 and 15 years later to the Shepparton Partners Collective led by Perpetuity for $45m 


Bringing these companies together in a business with a turnover of $400m can give economies of scale making significant profits ..


The Players  


The major SPC shareholder is boutique investment house Perma Funds Management. Other shareholders include the meat industry superannuation fund Australian Food Super, and the billionaire Shahin family which sold the On the Run petrol station business to ASX-listed Viva Energy for $1.2 billion in 2023.


OJC an asx listed company is chaired by Jeff  Kennet (who will retire when the deal is done)  and led  CEO Steven Cail who is expected to  stay with the business 


Nature One Dairy CEO Nick Dimopoulos, will continue with the combined business for the transition period


Former Asahi Beverages Group CEO and SPC director Robert Iervasi will be appointed managing director of the merged business, and chaired by Hussein 


NAME

NEW ROLE

CURRENT ROLE 

Hussein Rifai

Non-executive chairman

Executive chairman SPC

Andrew Cohen

Non-executive director

Executive director SPC

Kerry Smith

Non-executive director

Non-executive director OJC

Adam Brooks

Non-executive director

Non-executive director OJC

Robert Iervasi

Managing director
Non-executive director

Non-executive director SPC

David Mallinson

Interim CFO

SPC CFO

Nick Dimopoulos

Head of NOD and Asian market

Nature One Dairy CEO


The Products 


The main brands in the SPC business are SPC, Ardmona, Goulburn Valley, and ProVital. 


The Original Juice Co lbrand is the third-largest orange juice producer in the country.


Nature oNe Dairy is a Singapore registered company that produces  manufactures and sells infant formula, nutritional formula and milk powder products


The Vote 


The vote by shareholders to approve the merger will be held in November.


Sources


Kuisine Group and 100 per cent of Melbourne beverages group Helping Humans, which makes juices and kombuchas. https://www.afr.com/street-talk/spc-calls-in-grant-samuel-to-scout-deals-20220329-p5a8xp


https://www.afr.com/companies/retail/spc-bulks-up-in-400m-merger-with-original-juice-company-20241002-p5kf8b?cx_testId=4&cx_testVariant=cx_1&cx_artPos=0&cx_experienceId=EX4V7UQXCDIJ&cx_experienceActionId=showRecommendations08X6RHBOBRXICJQ#cxrecs_s



https://www.just-food.com/news/australias-original-juice-company-spc-nature-one-dairy-merger/

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