Comvita is divesting a minority stake to Singapore-based Fraser & Neave (F&N) as part of a strategic funding initiative. The New Zealand-based Mānuka honey producer aims to raise up to NZ$30 million ($17.7 million) through this share offer, which is contingent on securing an additional refinancing agreement with other financial institutions.
In a stock exchange filing on April 15, Comvita announced that F&N, through its subsidiary F&N Ventures, has committed to invest up to NZ$15 million. Should this investment proceed, F&N would acquire a 19.99% stake in Comvita. This partnership aligns with F&N’s strategy to enhance its existing portfolio, which includes soft drinks, dairy, and food products in Southeast Asia.
F&N CEO Rahul Colaco stated, “Our participation in Comvita reflects F&N’s continued focus on strengthening our portfolio in higher growth, premium consumer segments.” He emphasized the mutual benefits of collaborating within key Asian markets, where F&N has established capabilities and a deep understanding of local markets.
Bridget Coates, chair of Comvita, remarked that the addition of F&N is a “significant and deliberate” aspect of this offering. This alliance could open avenues for channel and market expansion, as well as digital innovations, data analytics, new product developments, research and development, sustainability, and operational efficiencies across the supply chain and technology.
Comvita CEO Karl Gradon highlighted that engaging F&N will bolster growth in targeted ASEAN markets. This announcement follows earlier speculation regarding F&N’s interest in Comvita, particularly after the company’s lenders supported a recapitalization initiative once Florenz’s takeover attempt faltered in December.
Comvita’s equity raise will be conducted through a pro-rata renounceable rights offer, priced at NZ$0.65 per share for eligible shareholders. The offer is set to open on April 23 and close on May 7. Furthermore, Comvita retains the option to conduct a share placement to F&N at NZ$0.80 per share, which could increase total proceeds to as much as NZ$44 million.
Upon completion of the transaction, Comvita intends to add a director nominated by F&N to its board. In the same filing, Comvita disclosed that it has secured a conditional refinancing agreement with its banking syndicate, contingent upon completing the capital raise.
