Limoneira invests in northern Chilean citrus
California-based fruit business Limoneira Company (NASDAQ: LMNR) has made its first investment in foreign operations after buying a stake in a northern Chilean citrus packhouse.
Limoneira announced today that it invested US$1.75 million for a 35% stake in La Serena-based packer Rosales, which currently sells its produce to Asian, European and local markets.
The new shareholder will handle Rosales' lemon sales to Asian markets where it will earn US$0.50 per carton, while also earning equity income.
In a release, Limoneira estimated these earnings would add up to US$200,000-300,000 per year.
"We are excited about our first international business investment. Our management team has a long-standing relationship with Rosales, and we look forward to working with them more closely following our investment," said Limoneira senior VP Alex Teague.
"Along with expanding our participation in the growing global lemon business, this investment also enables Limoneira to better evaluate future potential investment opportunities in Chile's vast, productive agricultural properties."
CEO Harold Edwards said the company had been looking for the right opportunity to enter the Chilean agriculture market "for some time" and was pleased with the Rosales partnership.
"Our investment in Rosales is consistent with our long-term strategy to expand our agribusiness internationally as a global, year round supplier of lemons.
"Our business will benefit from our increased packing capacity following our Rosales investment, as well as our recently announced acquisition of Marlin packing house in Yuma, Arizona, and the expansion of our packing facility in Santa Paula, which will be completed next fiscal year.
"Our team also continues to evaluate strategic opportunities to acquire additional agribusiness acreage in both domestic and international markets."