June 29, 2016

Two of Australia’s largest fruit and vegetable suppliers have merged to form an entity that will have annual sales totaling $500 million.

Premier Fruits Group and LaManna Group, the country’s largest banana producer and seller, have announced a merger of equals effective July 1 that, according to the Financial Review, will result in the second biggest fruit and vegetable supplier in the country, trailing only Costa Group Holdings when measured by annual revenue.

Premier’s Anthony Di Pietro will assume the role of chief executive for the newly combined business while LaManna’s Brian Gargiulo will serve as the company’s chairman.

The merger builds on a successful decade-long relationship between the two companies through their joint venture, Fresh Choice WA in Western Australia, which has grown into a $60 million business producing tomatoes, peppers, cucumbers, eggplant and zucchini in greenhouses in the Virginia region.

“…the decision to merge our Australian operations reflects the deep mutual trust and effective working relationship between the two partners,” said the combined group’s chairman, Brian Gargiulo in a recent press statement.

“We are doubling our size by coming together,” Mr. Di Pietro told The Australian. “…this sets us up for future growth, investment and innovation and allows us to offer a bigger complementary range of fruit and vegetables to our major customers all year round.”

Looking forward, both companies can be expected to keep and continue to develop their existing brands, however, there are plans for expansion both domestically and internationally. The group, which already exports to 13 countries, is looking to boost its export volumes and is considering a future entry into the U.S.

“The industry as a whole has an enormous future and we need to leverage Australia’s position and pool its resources to take advantage of that,” Di Pietro told The Advertiser.

Di Pietro expressed to AFR Weekend the intent that the group will continue to leverage the fragmented nature of the industry by pursuing acquisitions and consolidation within the sector, buying up smaller fruit and vegetable players with an eye toward a float after approximately five years.

“In five to ten years we will look to where we have got to, but not in the short term,” he told AFR. “There’s a lot of growth to do. We are a private company and we can be very nimble with our decisions.”

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Lynda Kiernan