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SavourLife, a family-owned pet food company that has helped re-home more than 63,000 rescue dogs, is set to be acquired by the SunRice Group (ASX: SGLLV) for $20.3 million with the founders and all staff set to remain with the business.
Founded in 2013 by Michael and Kimberlee McTeigue, Sydney-based SavourLife donates half its profits to dog rescue groups and has given $8 million in support to these organisations since inception.
SavourLife will be integrated into SunRice's animal feed division CopRice, which is already a manufacturer for the target's products and has committed to continue its social mission-driven business model post-acquisition.
"I am excited by the opportunity for CopRice to help continue to grow the SavourLife business, which will expand our ability to deliver on our mission," says SavourLife co-founder Michael McTeigue.
"CopRice has been an important partner in building SavourLife into the business it is today, and I know that together we will build an even greater business into the future."
SunRice Group CEO Paul Serra says the acquisition positions CopRice to further expand into the branded companion animal market where there is a growing demand for premium products.
"We believe that SavourLife is well positioned to continue to grow in Australia, with Australia having one of the highest dog ownership rates in the world. SavourLife will also complement CopRice’s existing products, which are known for their quality ingredients," says Serra.
"CopRice already manufactures SavourLife's dog food range. The acquisition will use CopRice’s existing manufacturing facilities and supply chain to improve efficiencies and provide future growth opportunities.
"We look forward to working with Michael McTeigue, SavourLife’s founder and the SavourLife team to continue to deliver on SavourLife’s mission of making a difference and continuing to support dog rescue groups."
SavourLife reported revenue of $33.4 million and normalised EBITDA of around $2.8 million in the year to 30 April 2024.
As CopRice is already a manufacturer for SavourLife, only incremental revenues will be recognised by CopRice, but the acquisition is expected to be accretive to CopRice’s EBITDA contribution in FY25.
The Sydney-based business has a national presence with its Australian made products available across all regions of Australia, from major cities to regional areas.
Completion of the transaction is expected to occur by 30 August 2024, pending satisfaction of a number of standard conditions precedent. The purchase price will be funded from existing cash reserves and available debt facilities.
SunRice has a dual-class share structure comprising A Class Shares held by rice growers, and B Class Shares that are listed on the ASX.
Holders of B Class Shares do not generally have the right to vote at general meetings of SunRice, and no person may hold more than 10 per cent of the total number of B Class Shares on issue.
At the time of writing the ASX-listed entity has a market capitalisation of more than $500 million.
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