In 2014 as the future of Elders appeared in doubt, the business created an eight-point plan to drive a turnaround. The following year, company CEO Mark Allison stated that the company is 95 percent on target, and that the business is on pace to deliver earnings before interest and tax of $60 million and a 20 percent return on capital by 2017.

Under its plan, Elders trimmed down to being a pure-play agribusiness after expanding into forestry, aquaculture, telecommunications, automotive parts, insurance, and banking before the 2008 global financial crisis.

Steps taken as part of its reorganization included the sale of its half share in Elders New Zealand business in 2014; the sale of its 776-hectare Charlton feedlot and cropping property in Victoria to Teys Australia that same year; the sale of its 50 percent stake in Australian Wool Handlers (AWH) to DP World Australia for A$30 million; and the managed exit of its live cattle export logistics business.

Additionally, as a key action in its retrenching, Elders shrunk its share capital through a ten-into-one share consolidation in early 2015, since which its shares have made solid gains.

This reorganization continues as Elders shifts its attention to growing its presence in the horticulture space. The company has confirmed its acquisition of horticulture business, Ace Ohlsson – a provider of services and inputs to producers in the horticulture industry with 20 trained agronomists, a central operation in Sydney, and five locations across New South Wales.

The acquisition of Ace Ohlsson, which was expected since the turn of the year,  is reflective of plans for the company that were expressed by Elders’ chief executive Mark Allison last year at the 2016 National Horticulture Convention when he said, “Horticulture for us is a prime market. We have the experience and history but now we have the opportunity to invest much more in it,” reports Farm Online.

In addition to agronomy services, Ace Ohlsson also provides financial services, machinery, marketing, irrigation, seed varieties, and seed technology.

“As well established leaders in the horticulture industry, we believe the Ace Ohlsson business is a good strategic and cultural fit for Elders,” Allison said earlier this year.

For Ace Ohlsson, which will continue to operate as it historically has, the deal with Elders will give the company access to a broad network that will enable it to enhance its offerings to its clients.

“The focus of Ace Ohlsson has always been about providing our clients with the best service, and we’re excited to be able to do this alongside the Elders brand,” said Charlie Horder, general manager, Ace Ohlsson.

-Lynda Kiernan

Lynda Kiernan is Editor with GAI Media and daily contributor to GAI News. If you would like to submit a contribution for consideration, please contact Ms. Kiernan at lkiernan@globalaginvesting.com.