Aug 26, 2020, 13:00 EST
Bronx, United States, Aug 26, 2020, 13:00 /Comserve / -- The Woolworths Group on Wednesday has announced a strategic partnership with Australia’s leading foodservice supplier, PFD Food Services wherein it will acquire a 65% equity interest in PFD’s business.
Bella Vista, Australia, August 21, 2020: The Woolworths Group on Wednesday has announced a strategic partnership with Australia’s leading foodservice supplier, PFD Food Services wherein it will acquire a 65% equity interest in PFD’s business. It will also acquire a 100% stake in PFD’s freehold properties that mainly consists of 26 fulfillment centers. The total worth of the acquisition is expected to be around USD 552 million.
The acquisition aims to enhance the positioning of the stores, support the evolution of the food industry, and leverage businesses for both companies by using various analytical approaches and optimization methods.
Initially, Woolworths Group will invest USD 302 million to purchase a 65% equity interest of PFD. It will then fully acquire the freehold properties of PFD for USD 249 million which will be leased back to PFD. The acquisition will be backed by the company’s existing cash reserves and available debt facilities. It is anticipated that the transaction will not affect the group’s existing credit metrics. For the initial year, the investment will be earnings-per-share accretive.
Under the deal, the Smith family owned PFD Food services will retain the remaining 35% stake in the company, which will be acquired by Woolworths in the coming years. After the acquisition, the senior management officials will be retained, and PFD will operate as an independent company under the CEO Kerry Smith. It will continue to work with Woolworths Group to deliver a better customer experience. However, this transaction is subjected to ACCC approval (Australian Competition and Consumer Commission) and is anticipated to be closed by the end of this year.
According to the half-yearly report of the Woolworths Group, the company’s sales increased to USD 32,410 million in the current year as compared to the previous year which was USD 30,587 million, a growth by 6% Y-o-Y. The online sales of the group also increased by 31.6% to USD 1,650 million in the first half since the company showed strong growth in its online business led by WooliesX, a new digital arm of Woolworths Group.
About PFD Food Services
PFD Food Service is a leading B2B food supplier in Australia. It delivers a wide range of products including dry goods, frozen and chilled products like seafood, meat and cleaning solutions, etc. For more information visit, www.pfdfoods.com
About Woolworths Group
The Woolworths Group comprises some of the most recognized and respected supermarket brands which serve millions of customers every day. It was founded in the year 1924 and has its head office in Bella Vista, New South Wales in Australia.
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