Strategic rationale for the acquisitions
Sources and uses
The Acquisitions will be funded with a combination of cash, debt and equity
Acquisition and funding details
Purchase
Price4
•
•
Total aggregate potential purchase price of the Acquisitions of $558.5m ("Total Acquisitions EV"),
comprising:
1. Acquisition of 100% of Superior Food for Total Potential Enterprise Value of up to $412.3m comprising an
upfront EV of $390m plus a contingent earn-out payment of up to $22.3m based on Superior Food's
actual EBITDA for the year ending 30 June 2024
2. Acquisition of 100% of Bianco for an EV of $82.2m
3. Acquisition of assets of Alpine Truss for an EV of $64.0m
Further details in relation to the purchase price of each acquisition, including earn-outs and working
capital/debt adjustments, are set out in Appendix A
The Acquisitions will be fully funded via:
a $300m fully underwritten institutional placement ("Placement")
Sources and uses
Sources¹
$m
Proceeds from Placement
300.0
Existing cash and available debt facilities
277.5
Total sources of funds
577.5
Uses
Acquisition of Superior Food
$m
412.32
Funding
up to $277.5m from existing cash and available debt facilities
•
Metcash's pro forma DLR as at Oct-23 LTM (adjusted for the Acquisitions and Equity Raising) is 1.16-1.19x
(refer slide 41)
•
Timing and
conditions
The acquisitions of Bianco and Alpine Truss are expected to complete in the fourth quarter of FY24 and the
acquisition of Superior Food is expected to complete in the first quarter of FY25 subject to Bianco and
Superior Food ACCC clearance being obtained
Acquisition of Bianco Construction Supplies
Acquisition of Alpine Truss
Estimated transaction costs
Total uses of funds
82.2
64.0
19.03
577.5
1.
2.
3.
Excludes the impact of any proceeds raised under the SPP. Metcash retains the right to accept oversubscriptions or to scale back applications (in whole or in part) at its absolute discretion that may result in the SPP raising more or less than $25m. Proceeds raised under the SPP will
provide Metcash with additional capacity to support growth opportunities.
In addition to the Total Potential Enterprise Value of $412.3m, Metcash plans to invest $30-40m in capital expenditure in Superior Food, above normal capex levels, to upgrade and enhance warehouse, fleet and IT assets over the three-year period after completion and which will be
funded from operating cashflows.
The transaction costs in relation to the Total Acquisitions EV ($558.5m) and Placement ($300m) include the estimated joint underwriting fees in relation to the Placement, investment bank advisory fees, external advisor due diligence fees and other transaction costs, which together
represent 2.2% of the Total Acquisitions EV and Placement combined ($858.5m).
4.
Further details in relation to the purchase price of the Acquisitions is included in Appendix A.
Metcash
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