The acquisition of Dairyworks by Synlait follows its recent acquisition of cheese-maker Talbot Forest
Image: Synlait to acquire Dairyworks. Photo: Courtesy of Synlait Ltd.
Dairy processing company Synlait has agreed to acquire Christchurch-based cheese supplier Dairyworks for NZD112m ($73.1m), subject to approval from Overseas Investment Office.
Synlait stated that the purchase price is 7.5 times Dairyworks’ earnings before interest, depreciation and ammoritisation (EBITDA) based on last one year’s earnings.
The acquisition of Dairyworks will support Synlait in moving towards delivering its Everyday Dairy strategy and also complements its recent acquisition of cheese manufacturer Talbot Forest.
Dairyworks was started in 2001 as a family business in the small South Island town of Temuka, located in New Zealand’s Cantenbury Plains. In 2013, the company was launched as a retail brand, branching out into snacking products.
In 2016, Diaryworks acquired ice cream brand Deep South and all the production moved from Invercargill to Christchurch.
Dairyworks will continue as a stand-alone business under Synlait
After the deal is closed, Dairyworks will continue to operate as a stand-alone business under the company’s umbrella, with its CEO Tim Carter, reporting to Synlait CEO Leon Clement.
Clement said: “This is an exciting opportunity for Synlait. This business is a great strategic fit for us and an important step in growing our presence in the Everyday Dairy category.”
“Dairyworks is a nimble and innovative company. It will fit well with Synlait and provides us with an opportunity to keep optimising our value chain while giving access into Australia where Dairyworks presence is growing.
“Opportunities exist in both businesses to streamline supply chains and enhance our competitiveness. It gives us the ability to optimise how we process milk solids and get the most value from our supply of milk. We’re excited by this opportunity as we work to capture more value in the dairy market in New Zealand and globally.”
Synlait acquired Talbot Forest Cheese in August this year. The deal included the property, plant and equipment of the Temuka site, along with the consumer cheese brand (Talbot Forest Cheese).
Synlait had taken over the management and operational control of Talbot Forest Cheese and Talbot Forest Cheese employees.