German agricultural giant BayWa's proposed takeover of a majority shareholding in New Zealand fresh produce exporter Turners & Growers (T&G) has been approved by the Overseas Investment Office (OIO), New Zealand's regulatory authority dealing with foreign investment.
The announcement means BayWa's public takeover tender offer, which was originally presented to T&G shareholders back in November 2011, has now come into effect.
Compensation for the 72.5 per cent of T&G shares tendered to date amounts to approximately NZ$157m (€98.1m) and, although the tender offer period for shareholders is due to run until 7 March, the transaction is expected to go ahead as planned now that OIO approval has been granted.
In a statement, BayWa described the takeover as "a ground-breaking step towards internationalisation" for the group, which has made it clear that a desire to expand into Asian markets in particular was at the heart of its decision to invest in T&G and subsidiaries including Enza and Delica.
The takeover of a majority share in T&G will most likely enable BayWa to become a global player in the supply of topfruit.
According to CEO Klaus Josef Lutz, who is to become chairman of the T&G board of directors, Asia will be T&G's largest growth market for fresh fruit in the coming years.
Being involved in T&G would enable BayWa to deliver "throughout the whole year", he added, while the group's German fruit growers also stood to benefit thanks to the development of new commercial opportunities in the global market.
Joining Lutz on the reconfigured T&G board will be BayWa's chief financial officer Andreas Helber, its agriculture and fruit business unit director Josef Krapf, and the head of its fruit business unit, Dietmar Bahler.
"The existing shareholders that still remain on board now are expecting T&G – and therefore its share price – to continue to develop well with BayWa's involvement," Lutz commented. "This shows their confidence in us as the new majority shareholder."
He added that BayWa intended to foster cooperation based on trust with shareholders and that the company intended to build close links with fruit growers in New Zealand.
"The relationship with the producers is very important to us as they are the backbone of T&G," he emphasised. "Trust and the capacity for development are key factors in setting up a global platform for T&G."
Approval of BayWa's takeover has been welcomed by the New Zealand industry.
"It is pleasing to see a company such as BayWa invest into the fruit and vegetable sector in New Zealand. They have a strong record of performance and a history of long term investment in their businesses," commented Pipfruit New Zealand chairman Ian Palmer.
"I am confident that BayWa will bring some surety to the apple industry, with their stated intent of lifting the returns to growers."