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Australian food exporter SunRice (ASX: SGL) is set to acquire the dairy and beef business of Riverbank Stockfeeds for less than $10 million.
Announced this morning, SunRice's stockfeed producing subsidiary CropRice has signed a purchase agreement to acquire the arm of the Victorian-based livestock product maker.
The cost of the acquisition, as well as working capital requirements and capital expenditure to upgrade the site at Leongatha, is not expected to exceed $10 million.
The acquisition includes Riverbank's feed mill at Leongatha, and dairy business across Gippsland and south west Victoria.
"The acquisition provides an additional manufacturing facility for CropRice in Gippsland, complementing its existing facilities at Cobden in south west Victoria, Tongala in northern Victoria, and Leeton and Coleambally in southern NSW," says SunRice.
"The acquisition is part of SunRice Group's 2022 Growth Strategy, which includes leveraging the group's strong balance sheet to pursue strategic value-accretive merger and acquisition opportunities, further diversifying earnings."
Shares in SGL are up 0.01 per cent to $5.10 per share at 12:30pm AEST.
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