New Zealand’s Comvita, the country’s largest mānuka honey producer, has accepted a $56 million takeover offer from Florenz, part of the Masthead investment group.
The bid values the company at $0.80 per share and would see it delisted from the stock exchange. Shareholders are set to vote on the offer in November, with the transaction expected to conclude in December.
Financial Struggles Push Comvita to Accept Takeover Offer
Comvita’s board has faced persistent financial challenges, including a $77 million after-tax loss in the 2024 financial year. Modest profits between $9 million and $13 million were reported from 2021 to 2023, but these followed consecutive losses in 2019 and 2020.
The company has undertaken significant restructuring, cutting 67 jobs, reducing the board size, and closing offices to save $15 million.
“Comvita has faced ongoing pressure from structural changes in the mānuka honey sector, which continues to face oversupply, price and demand volatility, and intense competition (including online),” said chairperson Bridget Coates. She added, “Industry dynamics require consolidation at pace, but sector leadership demands capital strength, scale, and speed, which are not available to Comvita under its current capital structure.”
Rival producer King Honey was placed into liquidation after failing to recover from the global honey glut, exacerbated by pandemic-era stockpiling, in July.
Deal Valuation and Shareholder Support
The transaction values Comvita at $56 million in equity and $119 million in enterprise value. Shareholders China Resources Enterprise and Li Wang, together holding 18.3% of shares, have already pledged their support. The proposal still requires High Court approval and an independent adviser’s report before being presented to shareholders in November.
Coates remarked that the sale would provide “certainty in a time of sustained challenges” for the sector.
Masthead’s Strategy: Resetting Comvita’s Growth Trajectory
Masthead chair Mark Stewart stated that the acquisition would reset Comvita’s trajectory. “While Comvita has faced challenges in recent years, the fundamentals remain strong. We believe privatisation – enabling substantial debt repayment, an injection of world-class leadership capability, and a sharper focus on high-value product innovation – will deliver a new chapter of growth.”
Florenz CEO Mike Tod said the takeover would position the company to scale globally: “This acquisition will strengthen our ability to support global wellbeing through trusted, science-backed products.
Comvita’s commitment to innovation, quality, and sustainability perfectly aligns with the values that guide our export growth strategy. We are proud to have the opportunity to keep this iconic company under New Zealand ownership.”
Florenz also plans to merge Comvita with Wedderspoon, the North American mānuka honey brand it acquired in 2023, creating what it says will be the world’s largest seller of mānuka honey products.
Comvita’s Leadership and Legacy
Founded in the 1970s by Alan Bougen and Claude Stratford in Paengaroa, Comvita grew into a global wellness company with more than 400 staff across five continents and B Corp certification.
Leadership has shifted in recent years, with CEO David Banfield resigning in 2023. Karl Gradon took over as chief executive this month, just ahead of the takeover announcement.