Kiwifruit firms quit merger plans
Satara and Seeka have abandoned plans to merge their kiwifruit operations.
Shareholders in Satara Cooperative Group Limited (Satara) have voted against a proposed amalgamation with rival Seeka Kiwifruit Industries Limited (Seeka) where a merge could have helped overcome industry implications surrounding the current Psa vine-wasting disease.
Satara’s shareholders “have voted and agreed not to amalgamate Satara and Seeka Te Puke, “ the companies have said in a recent statement where they will continue “pursuing business as usual.”
Under the proposed deal, Satara shareholders would have owned just over33% of a merged company handling 30% of the national kiwifruit crop and 20% of the avocado harvest.
Executives at the two kiwifruit companies were not immediately available for comment on the merger sidetrack, but Satara chairman Hendrik Pieters and his Seeka counterpart Kim Ellis have said the impact of Psa can’t yet be quantified but that both companies are losing vast amounts of fruit post harvest.
Seeka cut 41 jobs in October this year at a net cost of $600,000, with forecast earnings before interest, tax, depreciation, fair value adjustment and asset revaluations of $18.5 million to $19.5 million this calendar year.
Shares in Satara have halved in value in the past five years to trade recently at 38 cents, while Seeka stock last traded at 99 cents, implying a potential market value of $20.5 million.
Alternate partnerships for the two companies have not been confirmed as of yet, but with the current Psa virus spreading across the country it would not be a surprise if future mergers were made.