Ebro Foods and Ricegrowers Limited - Sunrice Sign Exclusivity Agreement
Subject to agreement on the final terms of the acquisition, Ebro Foods and SunRice anticipate executing a scheme implementation agreement by November 2010, with the scheme of arrangement being considered by SunRice shareholders in March 2011.
Oct 22 2010 --- Ebro Foods and Ricegrowers Limited, trading as SunRice, have entered into an agreement under which Ebro Foods has been granted exclusivity to negotiate the purchase 100% of the capital of SunRice.
SunRice, listed on the National Stock Exchange (NSX) of Australia, is based in New South Wales, Australia. The company sells approximately 500,000 tons per annum of branded rice foods principally through the retail channel and has leading positions in its main markets including Australia, New Zealand, the Pacific Islands, Hong Kong, Singapore, Papua New Guinea, the Middle East and California/Hawaii in the USA.
For the year ended 31 April 2010, SunRice reported EBITDA of AUS$56 million (approx. 40m euro). Ebro Foods expects SunRice to generate EBITDA of approximately AUS$70 million (approx. 50m euro) in the year ending April 2011.
Ebro Foods has been granted exclusivity on the basis of an Enterprise Value for SunRice of AUS$600 million (approx. 425m euro).
Over the coming weeks Ebro Foods will conduct financial and legal due diligence, negotiate the transaction documents (including a scheme implementation agreement) and submit applications for approval by the relevant Government authorities.
The proposed transaction will be effected by way of a scheme of arrangement of SunRice pursuant to Australian law. As a result, the acquisition will be subject to the approval of SunRice shareholders and the Australian courts. Subject to agreement on the final terms of the acquisition, Ebro Foods and SunRice anticipate executing a scheme implementation agreement by November 2010, with the scheme of arrangement being considered by SunRice shareholders in March 2011. On this basis, it is anticipated that completion of the transaction (subject to satisfaction of all of the conditions in the scheme implementation agreement) would occur in March 2011.
