T&G Global, Grandview Brokerage form venture to align US fresh produce assets
T&G Global, the fruit marketer controlled by Germany's BayWa, has agreed to a joint venture in the US that it says will improve its access to the American fresh produce market.
The agreement between the Auckland-based company and Grandview Brokerage (GBL), the parent of Vancouver-based Oppenheimer Group, will see T&G increase its stake in US produce marketing and distribution business David Oppenheimer and Co to 39.4% from 15%, with GBL holding the remaining 60.6%.
At the same time, T&G will reduce its interest in David Oppenheimer Transport to about 6% from 15%, with GBL picking up the other 9%. It will also sell 50% of its Delica North America business, T&G's US export business, to GBL.
The series of transactions net out as a payment from T&G to GBL of about $800,000. That's made up of T&G paying $11.4 million to increase its stake in David Oppenheimer, receiving $8.6 million for half of Delica and receiving about $2 million for the 9% of Oppenheimer Transport, T&G said in a statement. The deal is expected to be completed at the end of the month.
T&G chief executive Alastair Hulbert said the increased stake in David Oppenheimer, or Oppy US as it is known, underlines the importance of the US market, "in particular our Jazz and Envy PVR apple brands and the vital role Oppy US is playing in this success."
"Aligning our US export business with the Oppenheimer Group will enable T&G Global to present grower suppliers to both US and international customers and further strengthen its ability to service and support the needs of these US domestic and international customers and the consumers of fresh produce," he said.
Oppy US handles berries, citrus, kiwifruit, tomatoes, grapes and pipfruit and is one of three US-based licensed agents for T&G Global's proprietary varieties of pipfruit – Jazz, Envy and Pacific Rose, T&G said.
GBL is 65% owned by Ireland's Total Produce and 35% by GBL president John Anderson.
This week, T&G reported a 67% gain in full-year profit of $32.4 million. Its shares last traded at $3.50 and have climbed 64% in the past 12 months.