Total purchase boosts share price

The share price of Fyffes offshoot Total Produce plc rose by 5.6 per cent after it announced a €17.5 million acquisition in the UK. At one stage the share price was up more than 12 per cent. It closed at 75 cent, having started the day at 71 cent.

Total Produce comprises the former general produce and distribution division of Fyffes. It demerged and was admitted to Dublin's IEX earlier this month.

Yesterday it announced it had purchased British fresh produce company Redbridge Holdings for £11.75 million (€17.5 million).

The consideration was made up of an initial payment of £8.75 million plus a further cash payment of up to £3 million payable in 2010 if certain minimum profit targets are reached during the three years ended December 31st, 2009. The aggregate cost of the transaction reflects a net liability of £3.8 million arising from a deficit in the Redbridge defined pension scheme, bringing the total effective maximum cost to £15.5 million.

Redbridge holds strong market positions in the retail and wholesale sectors in the UK, according to Total Produce. It had a turnover of £236 million last year and pre-tax profits of £2.4 million. Redbridge has 668 employees.

The chairman of the Peterborough-headquartered company, Denis Punter, is to retain the role and also take on the position of chairman of Total Produce Ltd, the UK subsidiary of the plc.

Seamus Mulvenna, the managing director of Total Produce Ltd, is also being appointed managing director of Redbridge. Roger Allmond, formerly CEO of Redbridge, is being appointed finance director of Redbridge and of Total Produce Ltd.

Carl McCann, chairman of Total Produce, said: "This substantial company is a very important addition to our UK business."