Afimilk left to seek greener pastures after $70 million exit canceled due to Covid-19
In a shareholders meeting held to approve the deal, 70% of LIC's shareholders voted against the acquisition, mainly due to the ramifications of the coronavirus epidemic on the world's economy
In a shareholders meeting held to approve the deal, 70% of LIC's shareholders voted against the acquisition, mainly due to the ramifications of the coronavirus epidemic on the world's economy, with only 27% voting in favor.
Fortissimo had planned to sell its entire stake, 30.8%, while the kibbutz, which holds the remaining 69.2%, was set to sell 19.2%, leaving the kibbutz and LIC with an equal stake. The company was valued at $140 million according to the deal with LIC, four times its value when Fortissimo bought its stake in two stages during 2010.
The cancelation of the Afimilk sale joins the list of deals to fall victim to Covid-19, including the potential purchase of Israel-based micro-irrigation company Rivulis Irrigation Ltd. by Singapore's government holding company Temasek Holdings from controlling shareholder, Israel-based private equity firm FIMI Opportunity Funds, for a some in the region of $400-$450 million.
Following the cancelation, Fortissimo is expected to try and find another buyer or go public with Afimilk in the Tel Aviv or London stock exchanges.
Founded in 1977, Afimilk develops and manufactures computerized systems for dairy farming and herd management. The company's flagship product is a leg sensor that can provide real-time reports on an animal's health, helping farmers track factors such as fertility, milk quality, and productivity. The company had an annual turnover of $55 million in 2019, and an EBITDA of $9 million.
LIC is a century-old herd improvement and agri-technology co-operative. While headquartered in Hamilton, a city on New Zealand’s North Island, it has offices in the U.K., Ireland, Australia, Brazil, and the U.S. The co-operative reported sales of $200 million and a net income of around $60 million for fiscal 2019.
Fortissimo Capital is a private equity fund, established in 2004, that invests primarily in Israeli-related technology and industrial companies to help them expedite growth. Fortissimo raised $1.6 billion across five funds.
