The purchase comes just six months after the Australian Securities Exchange listed outfit acquired B.-d Paris Creek, a biodynamic organic dairy farm in South Australia for $34 million.
Ms McBain said St David Dairy provided Longtable with a “quality beachhead” into the Victorian milk market with its diversified customer base, which includes some of Australia’s best cafes and restaurants.
“St David Dairy is a truly premium brand embracing high quality produce, localisation and traceability; all important trends within the premium food sector,” Ms McBain said.
“Importantly it will also be part of our strategy to increase organic milk supply providing an additional pathway to sale of our in-conversion milk.”
Longtable will pay St David’s Dairy founders Ben and Bianca Evans $12.25 million in cash and $3 million in Longtable shares.
St David’s chief executive Mancel Hickey, formerly of Camperdown Dairy, will remain in the role.
The five-year-old dairy company has made a name for itself as Victoria’s only urban dairy, operating from a small factory in the Melbourne suburb of Fitzroy.
Mr Evans first got a taste for the industry helping his grandparents on their Toolong dairy farm, 10km north of Port Fairy. After graduating from high school in Koroit, he secured a dairy cadetship with Murray Goulburn. He then travelled across Europe’s dairy regions before returning home to open his own urban diary outfit.
The company employs 20 people and produces a premium range of milk, butter, cream and yoghurt, sourcing its milk from Gippsland farms.
Mr Evans said Longtable’s ethos of partnering with farmers would build the St David’s Dairy brand.
“St David’s was a natural fit for Longtable, the owners of B.-d Farm Paris Creek. For our amazing farmers, staff and customers, it is awesome to know we have true custodians of our business and brand, and all it stands for,” he said.
The sale will be funded by a $15 million capital raising that was also announced on Thursday. Longtable said 21.4 million new shares were sold to professional and sophisticated investors at $0.70 a share. The company’s share price remained relatively flat after the announcements.
The remaining balance of $2.75 million will be used for further investment in St David’s and to fund the cost of the transaction.
By: ALEXANDRA LASKIE
Source: The Weekly Times