Comvita Acquires NZ's Leading Med Honey Producer
Comvita Acquires New Zealand's Leading Medical Honey Producer
Comvita has purchased a North Island apiary business that specialises in the production of medical grade Leptospermum (Manuka) honey. The purchase includes 3000 bee hives located on 150 Manuka sites as well as a state-of-the-art medical grade honey extraction facility, land and buildings.
The purchase price is $2.15 million. 20% of the purchase price will be paid for with the issue of Comvita shares. The balance will be in cash. The acquisition is earnings accretive for Comvita.
The former owner of the apiary business, Bruce Stevenson, has been retained in a consultative role to work with Comvita over the next three years with a view to expanding and perfecting the medical honey supply programme. The programme will develop in line with growing demands around the world for Comvita's medical products sold under the Medihoney™ brand name.
Comvita's CEO Brett Hewlett stated that following recent FDA approvals for Medihoney™ Alginate and Gel Sheet wound dressings it is important to provide complete security over raw material supply. "This move fulfils the strategic objective of ensuring influence over the entire value chain for medical honey; from raw material supply through to market access. Owning a 'model site' enables us to further develop the most efficient procedures to harvest this unique and special resource and to set the highest standards for our medical honey supply programme. We can then work with all of Comvita's beekeeper suppliers to create maximum value for everyone."
Bruce Stevenson says, "the Medical honey project has exciting potential and the prospects look all the more promising with Comvita taking the lead in developing the supply programme."
Comvita's US licensee, Derma Sciences, reports that sales of the newly launched Medihoney™ Alginate wound dressings are building well and have exceeded expectations. "Clinical evidence from around the world for Medihoney™ is now very strong and US clinicians are compelled to try the products. Their response so far to a large number of trials has been very positive and we are encouraged by the reports that we are getting back from the US", said Hewlett.
Operational responsibility for the day to day running of the apiary business will remain in the hands of the current Management. "This apiary business has developed into one of the country’s finest under the existing management. They have been extremely innovative and developed practises that have resulted in superior yields and product quality. We want to retain and continue to build on this specialist knowledge" said Hewlett.