Fyffes buys Canadian mushroom company in €41m deal
Irish fruit and veg firm Fyffes has splashed out €41m on Canadian mushroom business All Seasons Mushrooms.
The deal is Fyffes' second move into the Canadian mushroom market having acquired Highline Produce back in April.
Fyffes has acquired full equity in All Seasons, funding the deal through its existing bank debt.
All Seasons is based in British Columbia and is one of the country's biggest mushroom producers. The firm operates out of four facilities, three of which are owned, the other leased.
Fyffes said its location will be very complementary to Highline. The All Seasons chief executive Frank Moscone will retain his role after the acquisition.
Fyffes chairman David McCann said he was pleased with the deal.
"It represents an excellent strategic addition to the Highline business which we acquired earlier this year.
"Together, Highline and All Seasons will be well placed to provide Canadian customers with a consistent supply of the highest quality mushrooms from coast to coast, while continuing to strategically supply US customers with premium and organic mushrooms," Mr McCann said.
The move has strengthened Fyffes' presence in the Canadian market and Goodbody analyst Patrick Higgins said the company is now the clear market leader in the area.
"In addition, it further diversifies the group's portfolio of operations - we estimate bananas now represents 50pc of group earnings before interest and tax (EBIT) - and underpins our view that its current modest valuation fails to capture the less volatile profile of the Fyffes business model," Mr Higgins said in a note on yesterday.