Elders to acquire Australian Independent Rural Retailers (AIRR)

Elders to acquire Australian Independent Rural Retailers (AIRR)
Elders to acquire Australian Independent Rural Retailers (AIRR)

Elders is set to acquire Australian Independent Rural Retailers (AIRR).

The acquisition will give Elders a footprint in the wholesale supply of farm products.

It has been suggested it positions Elders to compete more strongly with Canadian fertiliser giant Nutrient.

Elders has made a $187 million scrip and cash offer for unlisted private wholesale buying group Australian Independent Rural Retailers.

The agribusiness announced on Monday it had entered a scheme of implementation to acquire 100 per cent of AIRR’s shares, with the half-scrip, half-cash bid already receiving the blessing of the takeover target’s board.

Elders, which remains in a trading halt, said it was funding the acquisition through a $137 million equity raising and the issue of $79 million of new Elders shares to AIRR shareholders as scrip consideration.

The $10.85 per share deal values AIRR at $157 million on an equity basis and $187 million on an enterprise value basis.

Elders said the acquisition will allow it to enter the wholesale rural services market with net synergies of $6.6 million to $9.33 million per annum to be
gradually realised over the next two years.

“Acquiring AIRR will give Elders a national wholesale platform,” Elders chief executive Mark Allison said.

Tags: 
Farming Elders

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