Scales Corp. Ltd., New Zealand, announced plans to sell its cold storage businesses, Polarcold Stores Ltd. and Whakatu Coldstores Ltd. (which merged Jan. 1 under the Polarcold brand), to Emergent Cold, Dallas, Texas, for $151.4 million.
“We are proud to have built a market-leading position in the New Zealand cold storage industry,” says Andy Borland, managing director of Scales Corp. “We were approached by Emergent Cold, who see Polarcold as an ideal fit within their broader strategy of acquiring and developing a global network of cold chain businesses. Under the ownership of Emergent Cold, Polarcold will be able to offer its customers global cold chain solutions and its employees an opportunity to be part of a global enterprise.”
“Scales has built the leading cold storage business in New Zealand through dedicated service to customers, commitment to employees and the highest quality operations,” adds Neal Rider, chief executive officer of Emergent Cold. “We are excited to partner with this outstanding management team – we look forward to supporting the continued growth and expansion of the business and its customers throughout New Zealand and Asia Pacific with Emergent Cold.”
“As highlighted in our annual results announcements, Scales is refreshing its strategy, adopting a greater focus on pure agribusinesses that play well to our strengths. We have identified our strengths as operating fully-vertically integrated agriculture businesses, participating in businesses with an export focus and adding value through connections to the China market,” says Tim Goodacre, chairman of Scales Corp. “In addition to being less aligned with our core strengths, the returns (measured as return on capital employed) from our storage activities are also lower relative to our other business divisions and broader opportunities available to the group. At this stage, there is no intention to return capital to shareholders. Rather, the proceeds are intended to be used to pursue other attractive opportunities in New Zealand agribusiness, both currently and in the future.”