Creates comprehensive animal nutrition offering for North American and international farming
Combined company to be a global leader in animal health and nutrition with annual revenues in excess of USD $1.6 billion
Allows Alltech to deliver greater performance and value to farms around the world with industry's most advanced animal nutrition products and solutions
Accelerated product innovation from combined technology, research and data analytics
[LEXINGTON, KY and MANKATO, MN] – Alltech and Ridley Inc. (TSX: RCL) ("Ridley") announced today that they have entered into a plan of arrangement agreement under which Alltech will acquire 100 percent of the outstanding stock of Ridley, one of the leading commercial animal nutrition companies in North America, for CAD $40.75 per share. The total consideration payable to Ridley shareholders is approximately CAD $521 million.
The price of CAD $40.75 per share represents a premium of approximately 23% to the 20-day volume weighted average price of Ridley's common shares on the TSX as of April 22, 2015. The closing price of the Ridley shares on the TSX on April 22, 2015 was CAD $33.94. The boards of directors of both companies have unanimously approved the merger.
"This transformative transaction that combines two industry leaders allows Alltech to deliver better performance and value to livestock and poultry producers across the globe," said Dr. Pearse Lyons, founder and president of Alltech. "With Ridley's leading animal nutrition supplements, block products, extensive livestock and poultry producer distribution network and on-farm presence, we will be able to bring our advanced nutrition technology to market faster and more effectively. This combination creates a new model to deliver superior animal nutrition and tailored feeding programs supported by robust scientific research and data analytics. This deal underscores our continued momentum in growing our business through strategic acquisitions of best-in-class companies with trusted technology and brand recognition."
"Joining Ridley with Alltech is about bringing the best nutrition solutions to meat, milk and egg producers around the world," said Steven J. VanRoekel, president and CEO of Ridley. "Alltech is the technological leader with a broad global footprint so by uniting forces we will create a scalable platform to grow and market solutions to enhance the profitability of producers. We are also joining a financially strong company that is committed to investing in science and innovation so that we can deliver the most advanced animal nutrition solutions."
Ridley is one of the largest commercial animal nutrition businesses in North America. Ridley manufactures and markets a full range of animal nutrition solutions, including formulated complete feeds, premixes, feed supplements, block supplements, animal health products and feed ingredients. Ridley's customers include livestock producers as well as equine and pet breeders. Ridley's products are sold to producers by direct sales or through distributor and dealer channels.
Both companies are industry leaders committed to investing in sustainable nutrition solutions and advanced feeding programs that optimize physical and financial performance on farms, leading to increased efficiency and value. Alltech spends approximately 10 percent of its gross revenue on R&D, more than any other company in the industry. Ridley has a strong technical team with over 40 advanced degree staff who have produced some of the industry's best-selling and most widelyrecognized blocks and nutrition supplements and will now be working side-by-side with Alltech's team of approximately 150 Ph.D.s. This deal will further enhance Alltech's primacy in science and allow it to deliver this to a broader range of livestock and poultry producers in the U.S. and bring more advanced animal nutrition solutions to countries across the globe.
Improved animal nutrition is a pressing need for the productivity of the world's livestock and food chain. Feed costs comprise the majority of livestock production costs. By improving nutrition, livestock and poultry producers are able to realize a significant increase in efficiencies and return on investment. Alltech's continued commitment to tailoring nutrition and health programs with a focus on natural, antibiotic-free ingredients allows livestock and poultry producers to raise healthier animals through a process that is better for animals, consumers and the environment.
The combined company will have a presence in over 128 countries and 4,200 employees worldwide. Alltech has more than doubled its sales in the last three years and is on target to achieve USD $4 billion in sales in the next few years.
The transaction is subject to approval by Ridley shareholders, regulatory review and other customary closing conditions. The transaction is expected to close by the end of the second quarter.
Alltech has established a track record of successful acquisitions, having completed seven since 2011.