Seeka Limited and Opotiki Packing and Cool Storage Limited are to join via amalgamation, the companies said in a statement.
The OPAC shareholders will receive new shares in Seeka at the ratio of 1.4833 Seeka shares for every 1 OPAC share held, valuing the net assets of OPAC at $33.94m provided OPAC shareholders approve the transaction with a 75% approval required.
Seeka will assume approximately $25.06m of debt as part of the acquisition bringing the total deal to $59.00m.
Seeka expects the bigger business to generate material efficiencies, synergy benefits and cost savings for the benefit of all stakeholders.
OPAC’s Chairman, Tony de Farias, in announcing the deal, said: “The amalgamation brings together two companies with a long relationship and similar ownership structures.
“Many OPAC shareholders and growers are also shareholders in Seeka. The Board of OPAC recommends the deal to shareholders believing the enterprise value of $59m to be fair, with good opportunities for growth and synergies. The combined group will deliver efficiencies, new technology and grower support.”
Seeka Chairman, Fred Hutchings said: “The purchase of OPAC is consistent with our strategy and delivers the Eastern Bay of Plenty kiwifruit growing region to Seeka’s operations, a region in which Seeka is already experiencing growth through new orchard developments.
“The transaction is expected to be accretive to shareholders once the combined business is fully integrated. Seeka expects the bigger business to generate material efficiencies, synergy benefits and cost savings for the benefit of all stakeholders.”
The Boards of Seeka and OPAC unanimously recommended the amalgamation.