ArborGen acquires international tree improvement operationsFriday 24 Aug 2007 Rubicon informed the market today, that, ArborGen - a world leader in forestry biotechnology research, development and commercialisation, which is one-third owned each by Rubicon, International Paper and Mead Westvaco - has announced that it has entered into a series of agreements to acquire the respective tree improvement businesses of IP, MWV and Rubicon (i.e. Rubicon's Horizon2 business) for a total transaction value of US$60 million.Luke Moriarty, the Chief Executive Officer of Rubicon said, "This is an extremely important development for ArborGen - one that will allow ArborGen to significantly advance its business model. In one move, the acquisition of the United States nursery, orchard and tree improvement operations from IP and MWV, and the acquisition of the equivalent Australasian operations (i.e the Horizon2 business) from Rubicon, fundamentally repositions ArborGen from a business in development to an established commercial entity." The combination of these three leading operations into ArborGen's existing activities will provide ArborGen with an immediate and large presence in the sizeable North American marketplace. The combined IP and MWV businesses being acquired had sales of over 300 million treestocks last year, which represented well over a third of the entire pine treestock market in the US South and almost 15% of the hardwood market. It also gives it immediate operational scale, by having operations in 20 locations, spanning 4 countries (the US, Brazil, New Zealand and Australia) and employing over 185 staff. Mr Moriarty added "This transaction is positive not just for ArborGen but also for Horizon2's existing New Zealand and Australian customers". The overall transaction has been structured to ensure each Partner maintains its 33.3% ownership interest in ArborGen following the acquisitions. To enable this to occur Rubicon has acquired from Carter Holt Harvey (for $10 million) the 50% interest in Horizon2 that Rubicon did not already own. The closing of Rubicon's 50% Horizon2 acquisition is conditional upon the receipt of New Zealand's Overseas Investment Office (OIO) approval. The total ArborGen transactions are, in turn, dependent upon Rubicon's Horizon2 transaction with CHH closing and OIO approval being received for ArborGen to then acquire 100% of Horizon2 from Rubicon. |
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