Ceres Global Ag announces option to acquire Delmar Commodities
Jul. 11, 2019
Under the terms of the option agreement, Ceres has the right through July 31, 2019 to purchase all of Delmar's issued and outstanding shares for CAD $16 million in cash paid to Delmar's shareholders, and the assumption of approximately CAD $7.6 million in existing term debt. Delmar would operate as a subsidiary of Ceres, with Delmar's operations and approximately 55 employees strategically integrated into Ceres' overall operational network.
"We believe the addition of Delmar's grain assets to be an important first step in adding strategic origination for our core products, while also significantly advancing our portfolio diversification strategy with the inclusion of their soybean crush, agricultural seed sales & distribution and birdfeed product lines," said Robert Day, President and Chief Executive Officer of Ceres.
"We see significant value in Delmar's capabilities, market knowledge and customer relationships, but perhaps the most attractive aspect of Delmar is its people and their talent. This potential combination is an important step for Ceres as we execute our growth strategy, and we look forward to untapping the potential our teams can have working together," said Day.
"We are excited about the prospects of being a part of Ceres' business and team," said Dale Heide, President of Delmar. "Delmar's growth ambitions and plans, combined with Ceres' customer network and access to capital, would provide us with a unique opportunity to profitably grow together."
Ceres commenced due diligence on a potential acquisition of Delmar in February 2019. There can be no assurance that Ceres's due diligence will be concluded to its satisfaction or that an acquisition will be successfully concluded.
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