The Kentucky-headquartered group said it will acquire 100% of the outstanding stock of Ridley, which has 700 employees, for CAD $40.75 per share.
“The total consideration payable to Ridley shareholders is approximately CAD $521 million (USD $428M),” added Alltech, which was founded by Ireland’s Dr Pearse Lyons in 1980.
The acquisition, subject to approval by Ridley shareholders and the usual regulatory checks and balances, is expected to close at the end of Q2 2015, said the company.
Ridley, which had earnings of US$570m last year, will continue to be based in Mankato, Minnesota and will operate as a division within Alltech. Its senior management is reportedly going to remain.
Alltech has been quite active on the asset trail of late - last autumn saw it acquire premix manufacturer, Lienert, to develop the dairy and beef side of its business in Australia.
And in February this year, it bought a UK provider of farm environmental assessment tools, E-CO2, which Alltech said will give it access to ‘big data’ that would feed into its global feed research program.
The strategic rationale put forward by Alltech for the deal is that it will combine Ridley’s extensive on-farm presence and dealer distribution network in North America with its own animal nutrition technologies and will “accelerate product and solution innovation from a combined technology, research and analytics perspective.”
The Kentucky based group said it spends around 10% of its gross revenue on R&D projects, and that this new asset will further enhance its “primacy in science” and allow it to deliver that to a broader range of livestock and poultry producers in the US
“Ridley has a strong technical team with over 40 advanced degree staff who have produced some of the industry’s best-selling and most widely-recognized blocks and nutrition supplements and will now be working side-by-side with Alltech’s team of approximately 150 PhDs,” said the group.
Ridley’s customers include livestock producers as well as equine and pet breeders. Its products are sold to producers by direct sales or through distributor and dealer channels.