Juice manufacturer Trade Winds Citrus Limited is expanding into the milk business with its acquisition of the assets of Jamaica Beverages Limited, which has been in receivership for the last two years.
The sale price is unknown and is being kept quiet, according to managing director of Trade Winds Citrus Limited, Peter McConnell, who spoke with The Caribbean Business Report ( CBR) yesterday about his company’s latest acquisition.
He told CBR that “based on confidentiality agreements between the parties, we are not able to disclose the purchase price. It is however a cash sale that will be paid in full prior to possession. Closure and possession are expected within 90 days.”
The sale agreement, which was signed late last month, will see Trade Winds acquiring all the Bog Walk-based assets of Jamaica Beverages Limited, including the complete factory complex along with all the surrounding lands and buildings. The purchase also includes Jamaica Beverages’ popular Dairy Farmers brand, which is well established in the chilled milk category for both plain and flavoured milk.
The assets were being sold as Jamaica Beverages was put on the auction block to settle a court-awarded judgement amounting to US$4.5 million ($560 million). Trade Winds, which is the manufacturer of the popular fresh juice brands of Tru-Juice, Freshhh, Squeezz, Wakefield Juices and Calico Jack says the sale of the assets is in line with its strategic business plan to enter into the fresh and flavoured milk products market.
In addition, the sale of the assets will facilitate Trade Winds business strategy of diversification, expansion and innovation. Based on True-Juice’s entry into the primary production of fresh cow’s milk through the establishment of its dairy farm, the acquisition of the Jamaica Beverages’ brand and the associated equipment to process and package milk will provide the perfect springboard for Trade Winds into this new area of business. While the milk category will be new to Tru-Juice, the company will leverage its premium quality reputation to develop the trust and confidence of consumers, as it enters the milk market.
Tied in with this transaction is the granting of a trademark licence to Trade Winds for the Juciful brand. The manufacturing and distribution of this very strong brand will expand the Trade Winds reach in the very competitive juice market in Jamaica.
NEW INNOVATIONS TO COME
In a news release announcing the sale of the assets, Trade Winds, reports the McConnell majority-owned family business, will also be developing new innovations to continue to satisfy and excite the Jamaican palate locally and in export markets. The company says there will be more details on these new products in the months ahead.
Trade Winds plans to continue the business producing Jamaica Beverages’ products as a going concern, utilising all the same suppliers and distribution channels.
JOB SECURITY AND DISTRIBUTION DEALS WILL BE MAINTAINED
McConnell sought to reassure employees, suppliers, distributors, and customers that there is nothing to worry about as a result of the sale, “because we not only plan to continue the business, but to expand it; the only change is that it will be done the Trade Winds way”. The company also intends to interview all the existing employees that are interested in continued employment with the hope of minimising any dislocation.
Trade Winds sees the purchase of the assets of Jamaica Beverages in its Bog Walk-based locale as a commitment to agriculture, manufacturing, and to the community on a whole. According to McConnell, “When I heard that another factory was up for sale in our community of Bog Walk, especially one that is so aligned to our existing business, I felt that we should take a very serious look at it.”
He added that “based on the vision for our business, we saw a lot of synergies and potential for growth, so it was just a matter of negotiating a mutually acceptable deal. I think it is fair to say that we have a happy buyer and a happy seller”.
— Durrant Pate