Atlanta-based Americold, the world’s largely publicly traded cold storage REIT, announced on Tuesday that it has agreed acquire the world’s fourth-largest temperature-controlled warehouser, Agro Merchants Group from a group of investors led by alternative investment manager Oaktree Capital Management.
The purchase price was disclosed at $1.74 billion, of which $519 million will be paid in cash, $554.3 million paid through Americold common shares subject to a lockup period until May 2021, and the assumption of $110 million of in-place Agro capital leases and sale leaseback financing obligations.
Per the company’s announcement, privately held Agro is also the third-largest cold storage player on the European market, and the fourth-largest in the U.S., serving over 2900 customers across 10 countries, 46 facilities, 236 million refrigerated cubic feet and across multiple commodities.
Global freezer footprint
“We are very excited to welcome the Agro team to the Americold family as we expand the scale and enhance the geographic reach of the Americold network. The acquisition of Agro represents a unique opportunity to acquire an institutional-quality global portfolio that facilitates our strategic entry into Europe and adds complementary locations in the US, South America and Australia, where Americold is already established,” Americold President and CEO Fred Boehler said in an official announcement. “This strategic transaction provides exciting long-term growth opportunities through our ability to implement the Americold Operating System and commercial business rules across the Agro platform. In addition, we are excited about the external development and M&A opportunities that this acquisition provides.”
Americold is keen to expand its strategic footprint in Europe via Agro’s established access to the European food logistics networks. The deal will also position Americold to serve global multinational customers more effectively, adding key European and eastern U.S. port-advantaged locations, and strengthening Americold’s existing market position in Australia and South America.
Americold expects the acquisition to be modestly accretive in 2021, with significant long term benefits and value creation through integrated operations and other synergies.
Agro’s portfolio consists of 26 facilities in Europe, with 111 million refrigerated cubic feet in the U.K., Netherlands, Portugal, Ireland, Austria, Spain and Poland. The portfolio also spans 17 facilities in the U.S., with 115 million refrigerated cubic feet in six southeastern states, New Jersey and California.
Agro owns two facilities in Brisbane, Australia, and a 65 percent interest in a single-facility operator in Chile. Agro also holds a minority interest in a joint venture with Comfrio Soluções Logísticas, which operates 13 facilities across Brazil, the world’s ninth largest economy and a leading exporter of meat and other perishable commodities. As part of the acquisition, Americold will also assume Agro’s call options on the purchase of outstanding interests in the Chilean and Brazilian facilities.
In August, Americold announced two U.S. based acquisitions for cash, purchasing a 3.2 million cubic foot facility in Tampa, FL for $2.5 million, as well as the acquisition of AM-C Warehouses in the Dallas-Fort Worth, TX market for $82.5 million.
And in February, Americold entered a strategic joint venture on the Brazilian market, entering a strategic joint venture to own 15 percent of SuperFrio Armazéns Gerais SA, a subsidiary of Brazilian private equity firm Pátria Investimentos. The deal was struck for BRL $118 million (around $28 million).