LEO HLDG: Local Bounti® Closes Acquisition of Pete’s® – Form 8-K
Local premium® Closes Acquisition of Pete’s®
HAMILTON, Montana, April 5, 2022 – Local Bounti Corporation (NYSE: LOCL, LOCL WS) (“Local Bounti Corporation®” or the “Company”), a groundbreaking U.S. indoor farming company combining the best aspects of vertical and greenhouse growing technologies, today announced that it has completed its acquisition of the California-based complementary indoor farming company Hollandia Produce Group, Inc., which operates as Pete®as of April 4, 2022.
“Combining Pete’s operational scale and retail distribution footprint with our peak unit level economics creates immediate value for our employees, customers, partners and shareholders,” said Craig Hurlbert, co – CEO of Local Bounti. “This acquisition is immediately accretive and opens the door to further margin expansion as we implement our proprietary Stack & Flow technology.™ in Pete’s facilities and unlock additional operational synergies. Combined, this platform is well positioned to tackle the growing market for environmentally controlled agricultural products, which is expected to reach $30 billion in the United States by 2025, and generate accelerated returns on invested capital. . We welcome all 130 Pete employees to the Local Bounti family and look forward to a seamless onboarding process. »
Magda Overgaag, co-founder, matriarch of Hollandia Produce Group, Inc. and mother of Pete, said, “The closing of the transaction with Local Bounti marks another important milestone for my family and our long history in the industry. CEA which started over 100 years ago when my father and my husband’s father started growing under glass in the Netherlands. We immigrated our family to California in 1968 and have been innovating in cultivation techniques for various cultures ever since. Today, Pete’s is a trusted brand that provides the highest quality live lettuce varieties in the industry. We couldn’t be more excited about this transaction, which ensures our family’s legacy will live on and be a formidable force in the CEA industry for generations to come.
Local Bounti financed the purchase price of $122.5 million, with a combination of $92.5 million in cash provided under Local Bounti’s loan facility with Cargill, and $30.0 million dollars of consideration payable in common shares of Local Bounti. Along with the closing, Local Bounti also announced the appointment of Brian Cook as President of Local Bounti, who will report to co-CEOs Craig Hurlbert and Travis Joyner. Mr Cook previously served as Chairman of Pete’s from November 2017 until its acquisition by Local Bounti.
About Local Bounti®
Local Bounti is a leading Controlled Environment Agriculture (CEA) company redefining conversion efficiency and environmental, social and governance (ESG) standards for indoor agriculture. Local Bounti operates an advanced indoor grow facility in Hamilton, Montana, a few hours drive from its retail and restaurant partners. Reaching retail shelves in record time after harvest, Local Bounti products are superior in taste and quality to traditional field-grown greens. USDA Harmonized Good Agricultural Practices (GAP Plus+) and Local Bounti non-genetically modified organism (GMO) products are sustainably grown using proprietary technology 365 days a year, pesticide free no herbicides, and using 90% less land and 90% less water than conventional outdoor farming methods. With a mission to “bring our farm to your kitchen with as few miles as possible,” Local Bounti disrupts the growing and delivery of produce. Local Bounti is also committed to making meaningful connections and giving back to each of the communities it serves. To learn more, visit localbounti.com or follow the company on LinkedIn for the latest news and developments.
This press release contains “forward-looking statements” within the meaning of the “safe harbor” provisions of the United States Private Securities Litigation Reform Act of 1995. In some instances, you may identify these forward-looking statements by words such as “anticipate, “”approximate”, “believe”, “commit”, “continue”, “could”, “estimate”, “expect”, “hope”, “intend”, “may”, “prospects”, “plan”, “project”, “potential”, “should”, “should”, “shall” and other similar words or expressions. Forward-looking statements reflect the Company’s current expectations or beliefs regarding future events and actual events may differ materially from historical results or current expectations. Readers are cautioned not to place undue reliance on these forward-looking statements, which are not guarantees of future performance and are subject to a number of uncertainties, risks, assumptions and other factors, many of which are beyond under the control of the Company. . The forward-looking statements contained in this press release address a variety of topics, including, for example, the Company’s business prospects following the transaction. The following factors, among others, could cause actual results to differ materially from those described in these forward-looking statements: the effects of disruption to Local Bounti’s business as a result of the transaction; the impact of transaction costs on Local Bounti’s 2022 interim and full-year 2022 financial results; Local Bounti’s ability to retain Pete’s customers after completion of the transaction; Local Bounti’s ability to realize the expected benefits of the transaction; uncertainty of water supply (and related uncertainty of certain water use rights) for Pete’s facilities located in California; Local Bounti’s ability to effectively integrate acquired operations into its own operations; Local Bounti’s ability to retain and hire key personnel; the uncertainty of projected financial information; diversion of management’s time on transaction-related matters; the increased leverage of Local Bounti due to the additional indebtedness incurred in connection with the transaction; restrictions contained in Local Bounti’s debt facility agreements with Cargill; Local Bounti’s ability to repay, refinance, restructure and/or extend its indebtedness upon maturity; and unknown liabilities that may be assumed in the transaction. In addition, actual results are subject to other risks and uncertainties that relate more broadly to the Company’s overall business, including Local Bounti’s ability to generate revenue; the risk that Local Bounti will never achieve or maintain profitability; the risk that Local Bounti will not be able to effectively manage its future growth; the risk that Local Bounti will not be able to obtain the necessary additional capital when needed on acceptable terms, or at all; Local Bounti’s ability to construct additional facilities; reliance on third parties for construction, delays in delivery of materials and supply chains and fluctuation in material prices; Local Bounti’s ability to reduce cost of goods sold over time; the potential for damage or problems with Local Bounti’s CEA facilities; Local Bounti’s ability to attract and retain qualified employees; Local Bounti’s ability to develop and maintain its brand or any brands it may acquire; Local Bounti’s ability to maintain its corporate culture or focus on its vision as it grows; Local Bounti’s ability to execute its growth strategy; the risks of diseases and pests destroying crops; Local Bounti’s ability to compete successfully in the highly competitive natural foods market; Local Bounti’s ability to defend against intellectual property infringement claims; changes in consumer preferences, perception and consumption habits in the food industry; seasonality; Local Bounti’s ability to achieve its sustainability goals; and other risks and uncertainties disclosed from time to time, including those under “Risk Factors” and “Forward-Looking Statements” in Local Bounti’s Annual Report on Form 10-K for the fiscal year ended December 31, 2021, filed with the Securities and Exchange Commission (the SEC) on March 30, 2022, as supplemented by subsequent quarterly reports on Form 10-Q and annual reports on Form 10-K, as well as other reports and documents that Local Bounti files from time to time with the SEC. Local Bounti cautions that the above list of factors is not exclusive and cautions readers not to place undue reliance on forward-looking statements, which speak only as of the date hereof. Local Bounti does not undertake or accept any obligation or commitment to update or revise any forward-looking statements to reflect any change in its expectations or any change in events, conditions or circumstances on which any such statement is based.
Kathleen Valiasek, Chief Financial Officer
Local Bounti Society published this content on 07 April 2022 and is solely responsible for the information contained therein. Distributed by publicunedited and unmodified, on Apr 07, 2022 21:17:33 UTC.
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