Wynnstay snaps up feeds business for £9.5m
Agricultural supplies group Wynnstay has snapped up a company that makes and supplies poultry feed to farmers.
The Llansantffraid-based group is paying £9.5 million for Hampshire-based Humphrey Feeds and associated business Humphrey Pullets which operates mainly in the South of England.
Humphrey Pullets supplies point-of-lay pullets, and Humphrey Feeds sold around 109,000 tonnes of poultry feed sold in its last financial year to about 200 farmer customers
Humphrey's poultry feed manufacturing is based at facilities in Twyford in Hampshire, with a facility at Calne in Wiltshire currently unused.
Wynnstay intends to redevelop the Calne site into a modern circa 185,000 metric tonne capacity mill, manufacturing both poultry and ruminant feed. Planning permission is already in place.
On top of the £9.5m a deferred consideration of up to £2m may become payable dependent on the attainment of certain performance targets.
In order to fund the acquisition, the company is entering into a new £12.5m revolving credit facility.
The Wynnstay board believes the deal will be immediately earnings enhancing and will extend Wynnstay's geographic reach and adds new farmer and supply chain relationships.
It will also increase the group's poultry feed manufacturing capacity and purchasing power and significantly expand itsshare of poultry feed market for free-range laying hens.
Chief executive Gareth Davies said: "This is an excellent acquisition for Wynnstay. Humphrey is a long-established, family-owned business, with an 85-year history, which prides itself on 'advancing poultry performance'. It makes a highly complementary addition to the group, which will be readily integrated, and is expected to be immediately earnings enhancing.
"Humphrey fulfils multiple acquisition criteria for us. It will significantly extend our trading footprint in the South of England, enlarge our market share of poultry feed, a key target sector for us, increase our feed manufacturing capacity, and bring additional farmer customers.
"Looking further out, with the redevelopment of the Calne manufacturing facility into a ruminant as well as poultry mill, there is scope to drive additional significant long-term trading benefits."
