Itoham Foods Inc is looking to increase its stake in meat processor ANZCO Foods Limited from 48.3 percent to 65 percent, if its purchase offer is accepted by other leading shareholders and is approved by the New Zealand Overseas Investment Office (OIO).
A press release from ANZCO on Saturday morning noted that Itoham is Japan’s second largest meat-based manufactured and processed foods company, with an extensive meat sales and distribution network generating annual revenue in excess of $5 billion.
In its issuing notice to the Tokyo Stock Exchange, Itoham said it will buy 9,882,113 shares of ANZCO stock in cash transactions of just over $40 million.
The sale of shares involves another leading Japanese food company, Nippon Suisan Kaisha Ltd (Nissui), ANZCO’s founder and now chairman Sir Graeme Harrison and JANZ Investments Ltd, which is majority owned by Graeme Harrison in association with senior ANZCO managers.
ANZCO started operations in 1984 and was initially owned by the New Zealand Meat Producers Board who sold out 11 years later for more than a hundred fold return on their investment.
In 1995, Graeme Harrison led a consortium of investors, including Itoham and Nissui to purchase the shareholdings of the New Zealand Meat Producers Board and listed company Huttons Kiwi Ltd.
Nissui’s operations comprise marine products, processed foods and fine chemicals. It became ANZCO’s second largest shareholder in 2001. It is also a 50 percent shareholder in Sealord Group Ltd.
Until now Itoham and Nissui have been passive investors in ANZCO, with their investments being associated with former Presidents of both companies.
In 2009, Mitsubishi Corporation became Itoham’s largest shareholder at the invitation of the Ito family. Itoham has subsequently announced its intention to the Tokyo Stock Exchange to grow its business outside Japan by becoming the “most trusted manufacturer of processed meat in Asia”. Itoham’s investment with ANZCO is seen as being an integral step to achieving this goal.
The release notes there is to be no change in the current composition of the ANZCO Board and Harrison will remain as chairman and Mark Clarkson as managing director. This is the first time Graeme Harrison will sell shares since becoming a shareholder in 1987. He will reduce his effective stake from just over 20 percent to 14 percent.
At the age of 66, Harrison has signalled to his fellow shareholders and the ANZCO Board his intention to retire at an appropriate time.
Concurrent to the offer, the release notes, he has made an identically priced offer to the seven smallest ANZCO shareholders to simplify the company’s ownership.
ANZCO’s shareholding has been virtually unchanged since 2001. According to the company, it has paid dividends every year since then and maintained a record of rewarding all investors with profitable gains since its establishment in 1984.
If the move is approved by the other leading shareholders and the OIO, the overseas ownership of ANZCO will increase by 8.3 percent from 73.5 to 81.8 percent.
ANZCO is New Zealand’s second largest beef company and third largest meat related company, with 3,000 employees and annual sales revenue of $1.3 billion. It operates New Zealand’s only large-scale cattle feedlot, has sizeable investments in value-add businesses utilising raw material from the Group’s seven slaughter and processing sites and has the most extensive network of overseas offices associated with the New Zealand meat industry.