Ridley Corporation's Acquisition of Oceania Meat Processors

Ridley Corporation Limited (ASX:RIC) has announced the acquisition of Oceania Meat Processors NZ LP (OMP) for NZ$57.0 million (~A$52.8 million). OMP is a premium producer of mechanically deboned meat frozen block products and other raw materials for the global pet food industry. The acquisition is expected to be completed on 28 March 2024, subject to certain conditions, and will be fully funded from debt facilities. Ridley anticipates that this acquisition will be EPS accretive in the first year post transaction.

Ridley's Managing Director and Chief Executive Officer, Quinton Hildebrand, on OMP Acquisition

The acquisition of OMP represents a key milestone for Ridley's Ingredient Recovery business in the delivery of its FY23-25 growth plan. It provides a meaningful contribution to Ridley's ambition to 'climb the wall of value' by producing bespoke, higher value nutrients from existing and new raw material suppliers. This acquisition significantly increases Ridley's capacity to service the domestic and international pet food industry. We are extremely excited about the opportunities this acquisition provides to Ridley, our suppliers and customers, and look forward to the team at OMP joining the Ridley business.

Summary of Ridley's Acquisition of Oceania Meat Processors

Ridley Corporation Limited's acquisition of Oceania Meat Processors NZ LP aligns with its Ingredient Recovery growth strategy, aiming to deliver higher margins by producing bespoke, higher value nutrients from existing raw material supply. The acquisition is expected to enhance Ridley's offering to suppliers and pet food customers, significantly increasing its capacity to service the domestic and international pet food industry. With the acquisition price representing a multiple of 5.4 times EBITDA (LTM as at September 2023), Ridley anticipates the transaction to be EPS accretive in the first year post completion. The company's Managing Director and Chief Executive Officer, Quinton Hildebrand, expressed excitement about the opportunities this acquisition provides to Ridley, its suppliers, and customers, emphasizing the potential for growth and increased capacity to serve the pet food industry.