Wynnstay Group Acquires Feed Manufacturer and Supplier, Tamar Milling Limited
Wynnstay is pleased to announce that it has acquired the entire share capital of Tamar Milling Limited (“Tamar”), a manufacturer and supplier of blended feed products, for an initial consideration of £1.4m, with a deferred consideration of up to £0.1m payable dependent on performance. The acquisition is expected to be immediately earnings enhancing.
Established in 1994, Tamar is based in Whitstone, Cornwall, and manufactures and supplies a range of blended and coarse mix feed rations for dairy cows, cattle, and sheep to approximately 250 farmers, mainly in the south-west of England. Approximately 25,000 tonnes of feed is supplied annually. Tamar also operates a successful ‘on-farm’ grain milling service for farmers wanting to use home-grown or purchased grain in their livestock rations. Following its acquisition, Tamar’s founder, Nick Furse, will join Wynnstay in a senior commercial feed role and continue to lead Tamar’s operations.
In the year ended 30 September 2021, Tamar generated revenues of £6.40m, and a profit before tax of £0.42m. Net assets at 30 September 2021 were £0.92m.
The acquisition of Tamar is in line with the Group’s strategy of acquiring businesses that complement its existing activities and bring further benefits. Tamar significantly strengthens the Company’s presence in the south-west of England, adds a new farming customer base, additional supply chain relationships and significant cross-selling opportunities. It also establishes Wynnstay with its first feed manufacturing facility in the region, enabling it to provide its own bulk feed offering in the area.
The initial consideration of £1.4m paid on completion is subject to a net asset adjustment to be calculated based on completion accounts. The deferred consideration of up to £0.1m is payable dependent on product volumes transacted in the first twelve months following completion. The Group is funding the acquisition from its existing resources.
The acquisition of Tamar is the potential acquisition referred to in the Company’s announcement of 17 August. The second larger potential acquisition referred to in the same announcement is no longer under consideration as commercially acceptable terms were not reached. The Company continues to review a number of acquisition opportunities that meet its strategic priorities.
Gareth Davies, Chief Executive Officer of Wynnstay Group plc, commented: “Tamar is a long-established, high-quality manufacturer and supplier of blended animal feed and ‘on-farm’ grain milling services to farmers in the south-west of England. Like Wynnstay, it places a strong emphasis on customer service, and has a significant customer base.
“Tamar is highly complementary and will be immediately earnings enhancing. It fulfils multiple acquisition criteria. It increases our presence in the south-west, adds new farmer customers and provides us with our first feed manufacturing facility in the area. We look forward to working with our new colleagues and to continuing Tamar’s successful growth.”