Why we shouldn’t fear foreign investment

There are some common misconceptions when it comes to the effect of foreign investment in Australia's food manufacturing industry. Grant Thornton Australia's Tony Pittitto demystifies some of the big ones.

As Australian food and beverage companies assume larger roles on the world stage, the focus on innovation of products, processes and customer service becomes increasingly important in order to remain competitive.  

As you well know, trends emerge quickly, requiring companies to rapidly develop new products or risk missing out on profiting from hot new markets. But innovation requires investment, and we're seeing many Australian companies with limited access to capital feeling constrained in their ability to meet the needs of the changing market.

Many Australian companies are unable to access appropriate capital domestically to fund their growth plans. The recent Hunger for Growth survey indicated that more than half (53 percent) of Australian food and beverage executives believed their organisations would need additional funding within 12 months, with 16 percent noting sourcing capital as a constraint on their ability to grow their business.

Demystifying a sense of lost identity – a sector starved of capital
For some, mergers and acquisitions in the Australian food and beverage industry conjure up images of overseas buyers swallowing the heart and soul of iconic Australian food brands; when in fact, overseas buyers make up a very small portion of the deal activity across the entire sector. What's more, these investors are looking to capitalise on iconic brands, in order to market quality products in new regions, as opposed to eradicating the brand's identity.

Whilst international interest is undoubtedly strong, the sector still sees most acquisitions made by local buyers. Grant Thornton's Food & Beverage Deal Tracker report highlights that 80 percent of Australian businesses sold during the period January 2011 to June 2014 were to domestic acquirers. Overseas buyers accounted for only 20 percent of total deals over the same period.

Image: www.bppd.com.au

In some cases, private equity firms and overseas buyers provided the best option for the required level of capital to grow a company through product innovation. This is because private equity firms and overseas buyers have greater access to debt funding and equity investment and are known to look for Australian food and beverage companies with growth potential.

So is the perception fair that new owners destroy Australian brands? There's little evidence to suggest Australian brands are eroded when they're purchased by overseas buyers (think Vegemite, Fosters, Arnott's Biscuits and Uncle Toby's).  In most instances, these brands are the primary reason for the transaction, and there is little incentive for buyers to destroy them. In these examples, there has been little observable impact on the brand or product subsequent to the change in ownership. 

An analysis of the deals in the Deal Tracker report shows most transactions involving overseas acquirers were heavily motivated by the target's strong brands and quality products. Subsequent analysis suggests these brands and products remain a key focus after acquisition.

Opportunities to service the refining palates of the Asian market
Despite the perception of Australia "selling the food bowl", foreign investment continues to play an important role in the food and beverage industry. It provides capital for growth and innovation, as well as access to expertise and the scale required to take advantage of the growing demand in Asia.  

International buyers have demonstrated their capacity to provide the appropriate expertise for Australian companies to expand into overseas markets. They achieve this through their size, their established distribution and marketing channels and the existing network of people on the ground throughout Asia. 

Image: www.dreamstime.com

The capital employed by private equity firms and other investors (both domestic and foreign) stimulates innovation and efficiency. This creates a flow-on of benefits for the sector, including employment and growth throughout the economy. Farmers, suppliers and other services all benefit from growth and increased demand for Australian food and beverage products.

What it all means for Australian food producers
Many of the strategies that will help Australian food and beverage companies grow and succeed – from developing overseas distributions channels to expanding product portfolios – can be achieved through organic growth or through mergers and acquisitions.  

Particularly for mid-size and large companies, mergers and acquisitions offer opportunities that may not be available through domestic funding.

Ownership succession is also a consideration for many privately owned food and beverage businesses who may be contemplating sale. Many successful Australian food and beverage businesses are family owned. For the family owned businesses, with founders reaching retirement age, or having grown their business to the limit of their capabilities or desired involvement, the sector is in a prime position to service Asia's growing demand for high quality food products, which creates opportunities for such businesses to capitalise on when exiting their investment.

The international interest in Australian companies continues to provide healthy competition in the sale process, allowing Australian owners to realise higher returns upon exit. Our research highlights that higher multiples are consistently achieved by those businesses with strong brands in premium segments. We're seeing a trend that shows overseas buyers and private equity firms are willing to pay more for companies that are operating in the packaged food segment, and particularly those companies with strong brands, or those with innovative, organic and healthy products within their portfolio. 

Whilst the majority of merger and acquisition transactions continue to involve domestic buyers, the competitive tension introduced by international suitors has been a benefit for many Australian owners.

If Australian companies are to take advantage of the current market opportunities, they must have a growth strategy that ensures their business is well positioned to capitalise (either through organic growth or mergers and acquisitions) on the increasing demand from Asia for high quality food products. This strategy should address the company's ability to access capital, focus on strong brands, quality products within their portfolio, customer relationships and access to distribution and marketing channels throughout Asia.  

Many Australian companies will feel confident that they have the expertise and means to grow organically. For others, external capital provides a viable and attractive option, either to grow their business or as a lucrative exit strategy. 

Recent transactions including those of iconic Australian brands such as Inghams Enterprises and Peters Ice Cream, together with the interest in Australia's biggest wine producer, Treasury Estates, show that overseas private equity firms – in particular – continue to focus on growing Australia's food and beverage sector. Their continued interest represents bright future prospects for the sector.

  Tony Pittito is national head of food & beverage at Grant Thornton.


Jay Z acquires Armand de Brignac Champagne

French champagne brand, Armand de Brignac has been acquired by American rapper Shawn Carter, aka, Jay Z.

Identifiable by the distinctive pewter Ace of Spades insignias on the paperless bottle, Armand de Brignac retails for around US$300, and is made by a staff of just eight people at the Cattier family house which was established in 1763 in Chigny-les-Roses, France.

 “We are proud to announce that Sovereign Brands, a New York-based wine and spirits company owned by the Berish family, has sold its interest in the Armand de Brignac ("Ace of Spades") Champagne brand to a new company led by the globally-renowned Shawn "Jay Z" Carter,” Sovereign Brands wrote in a statement.

Sovereign Brands has not released the financial details of the transaction.


Singapore food company exits Victorian dairy sector

Listed Singaporean food company, QAF has sold its Oxdale dairy farm to European pension fund-backed corporate dairy, ACE Farming.

The sale – which went through for close to $5 million – was confirmed by ACE Farming founder, Jeremy Bayard, and marks QAF’s exit from the Victorian dairy industry.

"We are pleased to add this farm to the portfolio," Bayard told The Australian Dairyfarmer.

"We continue to add to our portfolio as part of our ongoing and measured growth program. We firmly believe in the Australian dairy industry, as do our investors."

The Oxdale farm brings ACE Farming’s portfolio up to a total of 17 farms across Victoria, making it the largest Australian mainland dairy producer.

There has been an increase in interest from European pension funds in the Australian dairy industry of late. In August this year, Murray Goulburn confirmed that it had sourced $20m from a Scandinavian pension fund to purchase nine dairy farms which have now been leased to the dairy co-operative.

"The superannuation funds are interested in the sector," Murray Goulburn’s managing director Gary Helou said at the time.

"They like the concept of Australian and New Zealand milk going into Asia."  


Re:Capital acquires Australian confectionery manufacturer, Betta Foods

International investment specialist, Re:Capital has announced its acquisition of Australian confectionery manufacturer, Betta Foods.

The deal will see Re:Capital – which is the investment arm of British restructuring company Hillco – transfer ownership of Betta Foods to holding company, The Confectionary Innovation group.

The purchase of Betta Foods marks the second acquisition of an Australian confectionery manufacturer by Re:Capital who purchased iconic Australian chocolate brand Ernest Hillier earlier this year.

Newly appointed chief executive of Betta Foods and CEO of Hillier’s Chocolates, Mark Campbell told Smart Company that the two companies offer products which are complementary, and that all 150 Betta Foods staff will be kept on.

“We see food manufacturing in Australia as a good positive moving forward,” he says.

“Part of that strategy is that we think it’s an ideal time for Australia to contribute to being the delicatessen of the world.”

Campbell says that since Re:Captial took over Hiller’s there has been a renewed focus on product innovation and customer engagement leading to an increase in staff numbers and a 20 percent increase on turnover.

Investment director for Re:Capital Australia, James Turner told Smart Company that the decision to purchase Betta Foods steamed from the businesses’ quality product range, experienced staff and good manufacturing facilities.

“For us there are a lot of SME businesses in this space which really do benefit from having size behind them, there are economies of scale,” Turner says.

“These products are being sold to a very similar customer base and to suddenly have a broader sales force combining the two gives a great boost.”


Pro-Pac acquires Nelson Joyce & Co

Pro-Pac Packaging has purchased Nelson Joyce & Co, a supplier of primarily flexible packaging products to the food and industrial markets.

The NSW-based national supplier has  a current annualised revenue of approximately $8 million.

According to a statement issued by Pro-Pac, Nelson Joyce & Co will be integrated into its Wetherill Park distribution centre.

Pro-Pac’s CEO, Brandon Penn, said “The purchase of this business continues our strategy of acquisitive growth particularly in higher value added products. There are particularly good cross-selling opportunities and beneficial logistics and distribution synergies that should provide additional sales and increased earnings.”

TWE ceases takeover negotiations

In an announcement to the ASX this morning, Treasury Wine Estates has confirmed that it will no longer be engaging in takeover discussions with Kohlberg Kravis Roberts &Co. L.P and Rhone Capital L.L.C.

In August this year, TWE received an unsolicited, indicative, non-binding and conditional proposal to acquire all of the shares of TWE at a price of $5.20 cash per share from Kohlberg Kravis Roberts &Co. L.P and Rhone Capital L.L.C. Roughly a week later, TWE received another takeover offer from an undisclosed global private equity investor to purchase all of the shares of TWE also at a price of $5.20 by way of scheme of arrangement.

Following a month of conversations with shareholders, TWE’s board and management have concluded that the price of $5.20 per share undervalued the company.

“The Board’s focus continues to be to act in the best interests of all shareholders,” said TWE’s Chairman, Paul Rayner.

“Following the receipt of the initial, indicative proposals from the two parties, we believed it was in shareholders’ best interests to grant those parties the opportunity to conduct non-exclusive due diligence. That process has now concluded and the Board is confident in the strategic plans to grow the company and is looking forward to working with management to deliver value to its shareholders.”

As part of its strategic growth plans, TWE announced that it will be expanding into the $US39 billion global travel retail market by securing shelf space at some of the world’s top airports, cruise liners and duty free shops. The company also announced job cuts back in May as part of efforts to reduce costs by $35 million in 2014-15.


ACCC gives Goodman Fielder takeover bid the go ahead

The Australian Competition and Consumer Commission (ACCC) has announced that it will not be opposing the proposed takeover of Goodman Fielder by Wilmar and First Pacific.

Both companies currently overlap in the supply of edible oils including canola, sunflower and soybean oil to Australian retailers. Goodman Fielder is the largest supplier of branded packaged edible oils to retailers, while Wilmar supplies imported packaged oils which are sold in supermarkets under their private labels.

“The ACCC determined that, following the proposed acquisition, Wilmar and Goodman Fielder would continue to be competitively constrained by alternative existing and potential suppliers,” said ACCC chairman, Rod Sims.

“Packaged vegetable oil can be readily imported from international suppliers. Wilmar currently supplies oil from its offshore facilities and there are other international suppliers capable of supplying the Australian market.”

“Industry feedback also suggested that packaged vegetable oil is considered a commodity product with low levels of brand loyalty, making it easier for retailers by bypass their existing suppliers.

Sims also added that the proposed acquisition was unlikely to raise competition concerns in any other markets in which both businesses operate.  Wilmar is a leading agribusiness group in Asia with its key Australian business in the sugar and edible oils markets, while Frist Pacific is an investment management and holding company operating in Australia through Indofood, importing and selling instant noodles, pasts and vegetables.

Goodman Fielder initially accepted the takeover bid by Wilmar and First Pacific in July this year.


Q&A with five:am founder, David Prior

Founded in 2011, organic yoghurt brand five:am was recently purchased by PZ Cussons Australia and New Zealand for  £44.1 million.

Part of the international consumer products group, PZ Cussons Plc, the domestic business also recently acquired baby food brand Rafferty’s Garden.

"I’m delighted that five:am has chosen a great home for the future,” founder David Prior said. “The cultural fit with PZ Cussons was apparent immediately and I’m sure the business will flourish under its ownership.”

Prior, who took a few minutes out of his schedule to tell us about his work, will remain involved in the company once the sale is completed.

David Prior

Company name:
five:am organics

Managing director

What are your primary roles and responsibilities in your job?
Financial, customer relationship, managing banks, revenue and profit growth, direction of the five:am brand, development of a strong HR team

What training/education did you need for your job?
There is a lot of on the job training. Most of my experience prior to five:am was through my family businesses. I developed a strong work ethic by working from the age of 7 for my dad. Formal education – I completed my MBA at the university of Melbourne. 

What is the one thing that you are most proud of in your professional life?
Building the five:am business from scratch to market in 12 months. This included the establishment of the plant, recipes, package design, distribution and marketing strategies, as well as putting together a team of passionate, qualified individuals.

Biggest daily challenge?
Being content with the fact that I’m not surfing.

Biggest challenge in the food manufacturing industry at the moment?
Eroding margins through a lack of innovation/differentiation.

What makes Australia’s food and beverage manufacturing industry stand out from that of other markets? 
Cleanliness of our environment, the security of our food supply chain, strength and diligence of our regulatory bodies such as the ACO (Australian Certified Organic).

Can you detail the growth that five:am has experienced since its launch in 2011? What do you attribute it to?
Turnover for FY12  was $7 million; it was $22 million for FY13; and it reached $35 million in FY14. I put this down to our great tasting quality products, achieving and maintaining an accessible price point, the ongoing support of major supermarkets and our loyal consumers. 

How will the recent sale of five:am to PZ Cussons affect the business?
PZ Cussons was chosen as the best new home for five:am due to alignment of values. They are a perfect match and will be able to respect the five:am brand and maximise opportunities here and overseas.

What will the next 12 months involve for five:am?
Greater penetration into Asia, innovation for our local market, greater engagement with our local consumers.

US Golden State Foods purchases Snap Fresh for undisclosed figure

New Zealand fresh produce company Snap Fresh has been purchased by US fast food supplier, Golden State Foods.

Golden State Foods, which is reported to be worth US$6 billion, is one of the world’s largest suppliers to the fast food industry.

Executive vice-president and chief operating officer of Golden State, Neil Cracknell said that the purchase of Snap Fresh will open up valuable growth opportunities and product development opportunity for the US company.

"We look forward to expanding our regional produce foodservice business into the fast-growing retail sector with such a strong and successful brand as Snap Fresh Foods," said Cracknell in a statement. 

"The addition of Snap Fresh provides great growth opportunities for GSF particularly in the retail salads segment, while providing new products and capabilities to our existing food service customers in the region."

Stuff.co.nz reports that Snap Fresh Foods has today changed its name to Vida Fresh.

Snap Fresh Foods was founded in Auckland in 1980 and sells a variety of salad and vegetable mixes along with dressings and condiments. The company operates two processing facilities and employs 150 staff.


Treasury Wine attracts second suitor in takeover bid

Treasury Wine Estates has received its second takeover bid, this time from an unidentified global private equity investor.

AAP reports that the new bid matches the first offer by US-based KKR and Rhone Capital which values the company at $3.38 billion.

Treasury Wines have said that they will engage with both bidders, but there was no guarantee that either bid will translate to a formal offer for the company.

TWE said that the benefits of both offers will be weighed against the company’s renewed strategy to boost sales and cut costs following its performance last financial year.

As part of the company's new strategy, TWE announced last month that it will be expanding into the $US39 billion global travel retail market by securing shelf space at some of the world’s top airports, cruise liners and duty free shops.  


Five:am yoghurt brand bought for £44.1 million

PZ Cussons Australia and New Zealand has purchased organic yoghurt manufacturer, five:am for £44.1 million.

Part of the international consumer products group, PZ Cussons Plc, the domestic business has achieved strong growth in the food and nutrition category in the past 12 months, including the acquisition of baby food brand. Rafferty’s Garden.

“It’s another exciting step for the Australian business and reflects our strategy of developing and acquiring leading brands in their respective categories,” Nigel Simonsz, chief executive of PZ Cussons Australia and New Zealand.said. “We see significant potential for five:am and, together with Rafferty’s Garden, we are building a strong portfolio of nutritious Australian food brands alongside our well-known brands in personal care and home care such as Radiant, Morning Fresh, Original Source and Imperial Leather."

Five:am was founded in 2011 and has its manufacturing operations in south-east Melbourne. David Prior, founder of five:am, will continue to be involved with the business following completion of the deal.

"I’m delighted that five:am has chosen a great home for the future,” he said. “The cultural fit with PZ Cussons was apparent immediately and I’m sure the business will flourish under its ownership,” he said.

Five:am is being acquired on a cash and debt free basis and is expected to be earnings enhancing in the current financial year.


24 hours with Symington’s Australia

Name: David Cherrie

Company name: Symington’s Australia Pty Limited

Title: Managing director

What are your primary roles and responsibilities in your job? Give us a day in your working life.
My key responsibilities include:

  • To lead Symington’s Australia in the delivery of the company’s strategic business plan
  • Accountable for the overall performance of the company and for the day to day running and management of the company’s business
  • To participate as a member of the Symington’s board
  • To understand the business, the marketplaces and sectors in which we operate and assist in developing the strategy to take advantage of the opportunities that exist or can be created
  • To develop strong retailer relationships in the Australian market and to ensure that Symington’s is positioned as the supplier of choice in its chosen categories

A typical day:

The great thing about working at Symington’s, is that there is never a “typical day.” No two days are ever the same, which means that there is never a dull moment.

I usually start my day with a freshly brewed coffee from one of the many great coffee houses across Melbourne. Having not been a coffee drinker before moving to Melbourne, I have come to appreciate this pastime.

Getting to the office, I usually review my calendar to check the meetings and activities planned for the day and review my ‘to do list’. My list acts a reminder of the tasks and deadlines I have – and is often kept at my bedside table during the night so that any thoughts or ideas can be jotted down if they pop into my head at 2am!

We try to do a “huddle’ in the morning to run through what everyone is working on, any big deadlines approaching or any support that anyone requires.

Other daily activities can include reviewing our financial and trading performance, analysing P&Ls, monitoring progress against our business plan as well as ensuring our service levels to customers remain within agreed targets.

Business development is also another key part of my role, we are looking to significantly expand our business in Australia and are always on the look-out for new brands to join our portfolio, either through acquisition, joint venture or licensing.

Finally, reporting is big part of my daily/weekly cycle. Weekly progress reports will be written to the board with full P&L analysis for the week and outlook going forward. This would also include a weekly “facetime” call with my boss (The Symington’s Group CEO) David Salkeld.

What training/education did you need for your job?
Passion for food has been integral to working with Symington’s. This is something I developed at a very early age. I got into baking cakes and would take them to a home for the elderly across the street to sell to the residents. They loved being able to get fresh cakes delivered to their door as well as having someone to talk to for a few minutes.

On a more formal basis, I did my degree in International Business and Languages, which included living a year in Germany. The degree allowed me to learn and appreciate the aspects of running a business, as well as exposure to business in different markets and cultures.

Throughout my career, I have also had the privilege of attending many different training programs including project management, selling and negotiation, and managing teams

How did you get to where you are today? Give us a bullet point career path.
Following graduation in 2001, I started my career at Diageo, working in Business Development.

I joined Arla in 2004 in the sales team with initial responsibility for the independent and cash & carry channel and growing the business in this channel by of 25 percent in the first year. I then moved on to manage the McDonald’s business (Arla supplied McDonald’s with their dairy needs (such as milk, milkshake and ice cream). At the time of taking over the account, Arla had 50 percent of the business with another supplier. Through a successful business development plan, I was able to secure 100 percent of the business, meaning Arla became the sole dairy supplier for McDonald’s – a significant achievement.

Following the start of my career in sales, I moved into the Marketing team at Arla. I was heavily involved in the launch of Lactofree (a Lactose free milk). With a strong marketing support plan, I was able to grow the brand to become a 12 million GBP grocery brand at RSV from a standing start.

After developing Lactofree, I then moved onto Cravendale (a top 100 UK grocery brand) and first branded milk in the UK.

I joined Symington’s in 2009, and have been there for almost six years.

The company completed its acquisition of Chicken Tonight, Raguletto and Five Brothers in Australia in 2013, and I was asked to go to Australia and set-up Symington’s here. Since then, I have been running Symington’s Australia.

What tools and/or software do you use on a daily basis?
I must admit I would be lost without my iPhone. The ability to check e-mail, calendars, use apps on the go is invaluable, particularly when travelling. I can open Google maps and be directed to anywhere I want to go.

What is the one thing that you are most proud of in your professional life?
The one thing I am most proud of in my professional life is setting up and launching Symington’s Australia. To have the opportunity to move to a completely different market, recruit a team, set up a business and its systems and processes, get familiar with doing business locally, integrating acquired brands into this business and ensuring a smooth transition with no service disruption to customers has been fantastic. In just 12 months we re-introduced well known Australian brands (Chicken Tonight, Five Brothers and Raguletto) back to Australian consumers, with new packaging, new recipes, and new advertising and are now seeing the brands grow significantly.

Biggest daily challenge?
Symington’s has been producing great tasting food for over 185 years, and there’s a huge amount of responsibility to uphold that legacy in Australia, especially when we are still relatively new to the market.

Biggest career challenge?
Shifting from a role that was focussed primarily on marketing to become a Managing Director with responsibility for all facets of the business in a new market. It is a challenge I am still enjoying as we continue to grow our team and brand portfolio here. I always work on the philosophy – you have to learn something new every day for your role to remain exciting, and this role has certainly given me many learning and growth opportunities.

What is your biggest frustration in your job?
As a new and proud Melburnian, getting to grips with the nuances of AFL has its moments. I love the AFL atmosphere and was quick to adopt a team (go Hawks!), but it is taking a bit more time to understand the many and varied rules of the game. I was told when I moved to Melbourne that if I didn’t understand AFL, then I would have nothing to talk about at the office on a Monday morning!

What is the biggest challenge facing your business?
There are preconceived notions that foods prepared for increased convenience are automatically unhealthy or poor quality.  At Symington’s we believe that you don’t need to compromise on taste or quality when it comes to convenient meals and snacks, regardless of whether you are cooking for one or feeding a family. We strive to achieve this in everything we do, and try to communicate through our packaging and advertising.

Is there anything else about your job you want Australia to know about?
We are very pleased with the results from our promising first year in Australia. As we progress through our second year, our focus is on innovation and growth and bringing more products and brands to Australian consumers.

If you would like to take part in Food mag's Industry Map, click here.

To read another Industry Map Q&A, click here.


SunRice looks to North Queensland for specialty rice

Rice food company SunRice has entered into an agreement to acquire Blue Ribbon Rice Group's milling and packaging plant in North Queensland.

The acquisition of the Brandon plant is a move to secure additional supplies of speciality rice, ABC Rural reports.

Last year, the plant processed 2,000 tonnes of rice.

SunRice chairman Gerry Lawson said the Burdekin region is regarded as one of the most promising rice-growing areas outside of south-west New South Wales, due to its climate and secure access to water.

“Local conditions are particularly suited to the growing of speciality rices, including fragrant varieties and specific long grain options, which will complement our Riverina crop and increase the overall competitiveness of Australian rice,” he said

The deal is expected to be finalised by September and is subject to clearance by competition watchdog, the ACCC.


New Zealand biscuit maker sold for $700m

New Zealand biscuit maker, Griffin’s has been sold to Universal Robina Corporation, a Philippines-based food manufacturer for $700m.

The sale, which is subject to approval from the Overseas Investment Office, is said to have doubled the initial investment made by Australian-based owners, Pacific Equity Partners, Stuff.co.nz reports.

Should the deal go ahead, Griffin’s chief operating officer, Alison Taylor will become CEO and executive chairman, Ron Vela, will be retained as a consultant.

Taylor believes that URC has purchased the company due to the significant opportunities for growth.

"That is why they are buying the business – for the manufacturing platform and the opportunities that provides for products in their markets," she said.

Vela echoed Taylor’s comments, stating that the sale is a positive move for the NZ workforce.

‘I just think they'll be investing forever. This is a gift in heaven for the New Zealand workforce, for the country itself," Vela said.

Griffin’s currently employs 800 people and operates two factories in Auckland.  


JBS Australia claims major stake in Andrews Meat Industries

The Australian subsidiary of the largest animal protein processing company in the World, Brazilian- based JBS, has announced that it has purchased a majority shareholding in Andrews Meat Industries.

Andrews Meat, which is a family owned, Sydney based company has been supplying red meat to the foodservice industry for over 40 years, specialising in high quality portion cutting, and further processing of meats for both domestic and international customers.

Chief executive of JBS Australia, Brent Eastwood said that purchase sets in line with JBS’ plans to expand into both the high growth retail, and value adding segments, The Weekly Times reports.

“With Andrews customer penetration in the prepared meats, high value added category, JBS Australia will be in a strong position to expand its extensive range of branded lamb and beef product into higher value market segments,” Eastwood said.


Edlyn Foods acquires Majestic Foods [video]

Edlyn Foods, which manufactures dessert, beverage and bakery preparations for the foodservice industry, has acquired Majestic Food Products.

Located in Smithfield NSW, Majestic Food Products manufactures boosters, gravy mixes, soup mixes, sauce mixes and coatings, also for the foodservice industry.

“Edlyn Foods is delighted to be able to bring such a high quality range of products in to its portfolio and continue their passion of manufacturing high quality Australian made products to their loyal customer base,” the company said in a statement.

The acquisition comes as Edyln releases a short video detailing its manufacturing and warehouse capabilities.



VIDEO: The Week in Focus


In our latest Week in Focus video, we wrap-up some of the most read stories from our website this week.

We cover the sad news of the passing of Doug Lehmann, son of leading winemaker Peter Lehmann, as well as the shocking news that resistance to a banned antibiotic has been found in chickens for sale in major supermarkets and butchers.

You can also the facts on the recent takeover bid for Goodman Fielder.


Craig Mostyn Group snaps up Jade Tiger Abalone

Australia’s largest abalone farm, Victorian based Jade Tiger Abalone has been sold to Western Australian food and agriculture based business, Craig Mostyn Group.

The purchase is said to be part of a $20m investment aimed at premium seafood markets in Asia and marks CMG’s first investment in aquaculture.

CMG successfully outbid a number of Chinese investors for the abalone farm which now sells over 95 percent of its product live to Japan, Hong Kong and China.

CMG’s CEO David Lock said that a sophisticated selective breeding program developed in conjunction with the CSIRO has seen productivity increase by 30 percent, and that the company plans to double its current output of 200,000 tonnes of abalone per year to 400,000 tonnes annually by 2017 with increased exports to China, Singapore and Hong Kong, The West Australian reports.

"Based on what we have seen, the science behind this abalone farm is far and away the best of any in Australia," Lock told the West Australian.

"Effectively, the business was a high-tech start-up that recently became commercially viable. It was the perfect time for us to step in and bring our expertise in marketing into Asia.

"We believe aquaculture offers great growth potential in Australia, specifically in the production of high-quality and high-value seafood."

The purchase of Jade Tiger Abalone adds to the company’s expanding seafood portfolio. The company spent $5 million late last year acquiring Tasmanian lobster businesses operating in Bicheno and Dover – which also happen to handle abalone – providing CMG with an introduction into the abalone industry.

"We started exporting live wild-caught abalone and understanding that business," Mr Lock said. "I haven't always been a proponent of the Asia food story being the saviour of Australian primary production but I am a strong believer in the niche market for the high-quality, high-value products that Asia wants and abalone is absolutely one of those."



Black Swan sold to Monde Nissin

Australia’s largest chilled dip manufacturer and brand, Black Swan, has been sold to Monde Nissin Corporation.

The sale of the Black Swan was led by Deloitte restructuring services partners Sal Algeri and Simon Wallace-Smith, who were appointed receivers and managers over the business in June 2013.

Sal Algeri said all Black Swam employees at the time of the sale have transferred to Monde Nissin.

The sale was managed by Deloitte corporate finance partner Victoria Brilliant, who said “The sale reflects the continued growth and profitability of the business over recent years.”

“Black Swan has grown revenues by a compound annual growth rate of 12 per cent over the last two years to around $70 million in FY14. This reflects the hard work of the shareholders and current employees in building Black Swan into Australia’s leading chilled dip brand with approximately 30 per cent of the Australian chilled dip market.

“Monde Nissin is a great fit for Black Swan dips and they are very excited about becoming the new owner.”

Monde Nissin has been operating in South East Asia for over 30 years as a food manufacturer and supplier of branded products including instant noodles, biscuits and other snack foods. It has significant presence in both the Philippines and Thailand.

“The sale is indicative of strong interest in Australian dairy and FMCG businesses, particularly from international players,” Victoria Brilliant said.