Seeka will establish a post-harvest hub in New Zealand’s Northland, with the Australasian fresh produce company acquiring T&G Global’s Kerikeri-based kiwifruit operation and assets.
The deal, valued at approximately NZ$40m (US$29m), will see Seeka purchase T&G’s Kerikeri packhouse facilities, which are used to pack and store kiwifruit, avocados and citrus.
Forecasts from the University of Waikato have predicted kiwifruit earnings in the Northland will more than double to NZ$72m by 2030, with the region’s sub tropical climate and varied soil types making it an attractive option for greenfield developments.
This optimism is shared by Seeka chief executive Michael Franks, who said the company’s avocado business would also benefit from the purchase.
“With new avocado developments in the area, we are expecting demand for post-harvest facilities to increase,” Franks said.
“We also anticipate increasing demand for kiwifruit as growing conditions have proven very favourable, particularly for gold varieties and with Seeka providing a new competitive dynamic to the market focusing on quality, price and service.”
The sale also includes approximately 80ha of kiwifruit orchards in the Kerikeri area, on which T&G currently grows the Gold3 (Zespri SunGold) and Hayward varieties, along with its proprietary ENZAGold and ENZARed kiwifruit.
T&G will remain the trademark owner of the ENZA kiwifruit brands. It will also have access to fruit grown by Seeka to service its existing customer base in New Zealand and overseas.
Additionally, T&G has agreed to sell all its Zespri shares to Seeka, valued at approximately NZ$2m (US$1.5m). The deal comes less than a month after Seeka announced its intentions to sell some of its own Zespri shares back to the single-desk marketer.
T&G’s executive general manager New Zealand, Andrew Keaney, said the sale was part of the company’s intention to focus on its core produce categories, which will continue to include citrus and berries grown in the Northland.
“Our Northland berry and citrus operations are not included in our sale as we intend investing further in these growth categories,” Keaney explained.
“We have land ready for development and will be investing also in crop protection facilities for our existing operation in Kerikeri. We also hope to employ more people through these investments.”
All staff from T&G’s post-harvest and kiwifruit orchard business areas will be retained by Seeka, which will rename the facilities and operating business entities Seeka Kerikeri.
The completion date for the post-harvest sale is expected to be 30 April 2018 and 30 June 2018 for the orchard sale.