Acquisition

22nd Jan 2008 07:00

Origin Enterprises Plc22 January 2008 Origin Enterprises plc reaches agreement to acquire Masstock Group Holdings Limited Origin Enterprises plc ('Origin') announces that it has reached agreement toacquire Masstock Group Holdings Limited ('Masstock'). Masstock, with operations in the United Kingdom and Poland, is the leadingprovider of specialist agronomy services directly to arable and grassland farmenterprises. Masstock, which has been synonymous with the development ofstate-of-the art farming systems throughout the world, was established in the1970's through the vision of two leading Irish entrepreneurs Paddy and AlistairMcGuckian. The initial consideration for the equity share capital of Masstock will beStg£26.3m. Deferred consideration of up to Stg£10m will be payable based on theachievement of profit targets over the period to July 2012. Masstock generated aturnover of Stg£250.6m for the year ending 30 June 2007 and operating profitbefore non recurring items and goodwill amortisation amounted to Stg£6.8m.Masstock had net tangible assets of Stg£23.6m at 30 June 2007 and net debt ofStg£30.6m. The acquisition is being funded by additional bank facilities. It is expectedthat the acquisition will be earnings enhancing for Origin from the date ofcompletion which is expected in early February 2008. The existing management team led by Declan Giblin as Group CEO, David Cribbin asManaging Director for the UK business and Graham Harris as Managing Director ofthe Polish business, who have been responsible for the development of Masstockover the past twenty years will be remaining with the Group. Commenting on the acquisition, Tom O'Mahony, Chief Executive of Origin said: "Masstock provides system-based solutions directly to over 10,000 farmbusinesses throughout the United Kingdom and Poland. This leading approachdelivers a fully integrated production system, based on a superior research andon-farm agronomy management. The business combines an extensive arable researchand development capability with a major sales, marketing and distribution focus,delivering a superior advisory and inputs offering to leading growers. Theservice encompasses varietal selection, nutrition, crop protection andapplication techniques necessary to ensure high performing marketable crops,which adhere to the highest levels of safety, quality, sustainability andenvironmental requirements." "The acquisition of Masstock significantly enhances Origin's capability tosupport primary food production. The structural shifts taking place globally inthe form of rising food demand and an increased awareness of agriculture as analternative supplier of energy is placing an enormous focus on best farmingpractice and soil protection techniques required to deliver sustainableproductivity. Masstock has the capability, expertise and proven ability torespond to this changing dynamic which combined with the geographical spread ofits business presents a new exciting growth opportunity for Origin." Commenting on the transaction, Masstock Group CEO, Declan Giblin said: "Theacquisition represents an important milestone in the development of Masstock. Wewill become an integral part of a leading organisation focussed on the valueadded and primary sectors of the food industry enabling us to leverage acombined capability within an exciting market environment." Ends Enquiries Origin Enterprises plcBrendan Fitzgerald, Chief Financial Officer Tel: +353 1 612 1259 Murray ConsultantsJoe Murray Tel: +353 1 498 0300 Tel: +353 86 253 4950 Nominated AdvisorDavy Corporate FinanceIvan Murphy, Director Tel: +353 1 614 8928 About Origin Enterprises plc Origin Enterprises plc is a leading Agri-Nutrition and Food company listed onthe IEX and AIM markets of the Irish and London Stock Exchanges. TheAgri-Nutrition division, through its manufacturing and distribution operationsin Ireland and the United Kingdom, has leading market positions in the supply offeed ingredients, crop nutrition and specialist marine proteins. The Group'sFood division, comprising sales, marketing, distribution and manufacturingactivities in Ireland, has leadership positions in ambient food across theretail, food service and manufacturing sectors. The Group has the benefit of asubstantial operating asset base including a number of significant propertieswith development potential located in areas destined for future development andregeneration. Website: www.originenterprises.com A webcast in relation to this announcement will be available on the company'swebsite later today. This information is provided by RNS The company news service from the London Stock Exchange

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