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Origin Gets Masstock for 326.3m

by 5m Editor
24 January 2008, at 2:20pm

IRELAND - Irish agribusiness Origin Enterprises has agreed to buy UK agronomy company Masstock in a deal reaching almost 330m, when all is done and dusted.

Masstock, established in the 1970's by two leading Irish entrepreneurs Paddy and Alistair McGuckian, has operations in the United Kingdom and Poland. It is a leading provider of specialist agronomy services to arable and grassland farm enterprises and has also been synonymous with the development of state-of-the art farming systems throughout the world.

The initial consideration for the equity share capital of Masstock will be £26.3m. Deferred consideration of up to £10m will be payable based on the achievement of profit targets over the period to July 2012. Masstock generated a turnover of £250.6m for the year ending 30 June 2007 and operating profit before non recurring items and good will amortisation amounted to £6.8m. Masstock had net tangible assets of £23.6m at 30 June 2007 and net debt of £30.6m.

The acquisition should be complete by early February 2008 and is expected to boost Origin's share price and earnings immediately.

Responding

Commenting on the acquisition, Tom O'Mahony, Chief Executive of Origin said the purchase will significantly enhance Origin's capability to support primary food production.

"The structural shifts taking place globally in the form of rising food demand and an increased awareness of agriculture as an alternative supplier of energy is placing an enormous focus on best farming practice and soil protection techniques required to deliver sustainable productivity. Masstock has the capability, expertise and proven ability to respond to this changing dynamic which combined with the geographical spread of its business presents a new exciting growth opportunity for Origin," he added.

Commenting on the transaction, Masstock Group CEO, Declan Giblin said the acquisition was an important milestone.

"We will become an integral part of a leading organisation focussed on the value added and primary sectors of the food industry enabling us to leverage a combined capability within an exciting market environment," he said

Fishing for more

Origin has also been reported to have entered exploratory discussions with Norwegian firm Austevoll Seafood. It is thought the deal centres on combining their fishmeal and fish oil operations - divisions which principally supply the aquaculture feed industry.

Origin's activities are through a wholly-owned operation based in Ireland and the United Kingdom. It also has a 50 per cent interest in a manufacturing facility in the Shetland Islands.

5m Editor