Paine & Partners takes 50% of Australian fruit and vegetable producer
US-based private equity firm Paine & Partners has paid an undisclosed amount for a 50% stake in Costa Group, Australia's largest private producer of fresh fruit and vegetables. The transaction is slated to close later this year, with Costa management holding the remaining 50%.
Costa claims annual revenue of more than A$600 million ($649.3 million), derived from its business growing and marketing products related to mushrooms, tomatoes, berries, bananas, citrus, grapes and avocados. The company also provides third-party warehousing and distribution services for chilled consumer products. Its aggregated staff exceeds 4,000 employees.
According to Kevin Schwartz, a founding partner at Paine & Partners, the investment is set to strengthen Costa's balance sheet and give the company access to additional capital to finance future growth and R&D opportunities. Following the transaction, Frank Costa and Harry Denby will continue as chairman and CEO, respectively.
Paine & Partners, which focuses on the global food and agribusiness industry, currently invests through its $1.2 billion Paine & Partners Capital Fund III, L.P. Its investees include Seminis, the world's leading global developer of vegetable and fruit seeds, and Icicle Seafoods, a producer and processer of seafood products.
Separately, another Australian investor, PrimeAg, also plans to target food and agriculture opportunities through its Agricultural Fund (Agri Fund). There will be an initial capitalization of A$250 million, with PrimeAg and an institutional investor contributin A$125 million each. Agri Fund has targeted its final close at A$600 million.
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