US investor puts $85m grape operation up for grabs
One of the country’s largest table grape businesses in South Australia’s Riverland region is up for grabs as its US owner looks to reap a return after developing an $85 million operation.
At Lyrup, some 250 kilometres east of Adelaide on the Murray River, Talia Farms runs over 230 hectares. It has a mix of grape varieties tailored for export into the growing appetite for Australian grapes in Asia-Pacific markets.
Its owner is RRG Capital Management, a California-based fund manager with a swag of horticultural properties across North and South America as well as Australia.
RRG’s portfolio in Australia includes the Koompartu almond operation at Monash, which is also in the Riverland region, and Nambucca Farms in NSW, which produces macadamias.
More broadly, RRG develops and manages assets across a range of sectors – agriculture, food, water management, habitat conservation, renewable energy – with a big focus on sustainability.
Under that rubric, it runs a series of vehicles through a strategy of taking on early stage risk investments. Talia Farms is held in its RRG Global Partner Fund, according to corporate records.
“With the successful development and imminent sale of Talia Farms, RRG remains committed to identifying greenfield opportunities for development and divestment when its assets are poised for optimal performance,” the company said in a statement provided to The Australian Financial Review.
Colliers agents Jesse Manuel and Tim Altschwager have been appointed to broker the Riverland offering.
“Based on other transactions in the horticulture sector and given Talia Farms’ production and income growth trajectory, an earnings multiplier in line with current market rates could see Talia Farms achieving a price in the vicinity of $75 million to $85 million.” Manuel said.
Australia has about 1000 table grape growers, and the industry has grown to be worth almost $1 billion annually. More than half the annual crop is typically earmarked for export, with 95 per cent transported by ship.
China accounts for almost one third of the export market, followed by Indonesia, the Philippines, Vietnam and Thailand.
Under the RRG’s investment, Talia Farms has become a high-tech operation with a packing facility that uses automation to achieve same-day pick, pack, and dispatch.
The fruit temperature can be cooled from 34°C to 0.5°C in just one hour, improving shelf life for the produce as its transported. The vineyard has 14 grape varieties.
Neighbouring Talia Farms is a large RRG-owned greenfield site, covering 594 hectares with approvals for horticultural development and soils suitable for almonds, citrus or table grapes and which is included in the sale offer.
