Trio Of Acquisitions Make Alico Top Citrus Producer In U.S.
December 3, 2014 Ft. Myers, FL-based agriculture and natural resources company Alico announced the acquisition of three Florida citrus producers for total consideration of approximately $363 million. These acquisitions will make Alico’s citrus division the largest citrus producer in the U.S., with total pro forma 2014 production of 10 million boxes annually.
The three acquisitions are: (1) certain assets and liabilities of Orange-Co LP, (2) 734 Citrus Holdings LLC, also known as Silver Nip Citrus, and (3) Gator Grove.
The Orange-Co assets include approximately 20,263 acres, which comprises one of the largest contiguous citrus grove properties in the state of Florida. The $274 million Orange-Co acquisition was financed with proceeds from Alico’s recently announced $97 million sale of its sugarcane assets and a portion of the proceeds from Alico’s new long-term debt facilities and related credit lines.
Silver Nip Citrus is comprised of approximately 7,434 acres. The $72 million Silver Nip Citrus acquisition will be financed with the rollover of its existing credit facilities totaling $43 million and the issuance of approximately 0.8 million shares of Alico common stock. The Silver Nip Citrus acquisition is expected to close in the first quarter of 2015.
Gator Grove is comprised of approximately 1,241 acres contiguous to the Orange-Co property. The $16.6 million Gator Grove acquisition was financed with cash on hand and closed Sept. 23, 2014.
Management believes that the acquisitions will yield significant benefits for the company and its shareholders, including:
- Creates the largest citrus producer in the U.S.
- Significant increase in Earnings Before Interest, Taxes, Depreciation and Amortization and free cash flow
- Highly attractive, long-term financing package
- Positions the company for long-term growth
“These transactions are transformative for our citrus business and represent a major step forward in our strategy to become a leading agriculture and natural resources company by identifying and executing on accretive growth opportunities,” said Clay Wilson, CEO of Alico. “We intend to continue to target attractive markets and establish leading positions in our different business lines where scale and expertise can generate strong returns for our investors.”
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