California-based fruit producer Limoneira Company has signed a deal to purchase 757 acres (306ha) of lemon, orange and speciality citrus orchards in the state’s San Joaquin Valley, for approximately US$15.1m.
The transaction, which was announced via the Nasdaq stock exchange in the US, is expected to be completed on 30 November 30.
According to the company, the orchards are being acquired under the terms of purchase options that were contained in certain operating leases it has held since 2012.
Those leases apply to a total of around 1,000 acres (405ha) of land, referred to by Limoneira as the Sheldon Ranch leases.
“The lease agreements include base rent of US$500 per acre and contingent rent of 50 per cent of the operating profit of the leased property as defined in the lease agreements,” the company explained in a statement.
“Total rent expense for fiscal year 2015 on the acquired property is estimated to be approximately US$0.9m as of the expected closing date of the transaction and was approximately US$1.6m for fiscal year 2014.”
Based in Santa Paula, California, the 120 year-old business is now one of the world’s largest integrated agribusinesses, with approximately 10,700 acres (4,330ha) of agricultural land, real estate properties and water rights in California and Arizona.
As well as lemons, oranges and speciality citrus, Limoneira also produces avocados and other crops, exporting them to markets around the world.
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