Vitarich Further Integrates with Acquisition of Barbatos
December 16, 2021– Vitarich Corporation (PSE:VITA) has reached an agreement with Luzon Agriventure Inc to acquire Barbatos Ventures Corporation (BVC) for a price of P1.00 as part of its vertical integration strategy. The valuation is based on net asset value as audited by MG Madrid & Company. The boards of directors of both companies have approved the transaction.
“The core of our strategy is to create value through further integration,” said Rocco Sarmiento, President and CEO. “BVC has been VITA’s dressing plant partner since 2019. This acquisition allows us to provide our customers with end-to-end processes, ensuring tighter control and traceability of operations which most hotel, restaurants, and institutional (HRI) customers value highly. It also delivers operational and financial synergies, including cost efficiencies.”
With 373 employees and contractors, BVC provides a range of services such as packing, cutting, and storage of dressed chicken, which will expand to chicken products specifically for HRIs following the acquisition. The company holds national and local permits for dressing plant facilities located in Marilao, Bulacan and Tugbok, Davao as well as relevant licenses and industry accreditations from the Department of Agriculture (DA), Department of Health (DOH), and the Department of Environment and Natural Resources (DENR). In addition, BVC Marilao has certifications for food safety management systems including Hazard Analysis and Critical Control Points (HACCP) and all its products are Halal accredited by the Islamic Da’wah Council of the Philippines (IDCP).
Capital expenditures related to improvements are expected to be P150 million in total, comprised of P93 million spent in 2021 and P57 million in 2022 for expanding and upgrading the Marilao facilities.
The addition of BVC will bring revenues of approximately P375 million to VITA by 2025, while also capturing cost synergies of P91 million. In the first two years following the completion of the acquisition, it is expected to contribute P46 million to net income or P0.02 to earnings per share.
Beginning January 2022, BVC will operate as a wholly-owned subsidiary that integrates dressing operations and contract growing. Carmencita S. Policarpio will be general manager. Ms. Policarpio joined VITA in 2016 and has held several senior roles within the organization, most recently leading the overall direction and operational activities of quality assurance and risk management functions. She is a licensed chemical engineer and has been admitted to the Association of Southeast Asian Nations (ASEAN) Engineering Register.
###
ABOUT VITARICH CORPORATION
Vitarich Corporation (PSE: VITA) is a pioneer, agribusiness partner, and leader in the animal feeds industry in the Philippines since 1950. Recognized with international standards for sanitation, food safety, and quality, VITA operates in three primary industry segments: feeds, foods, and farms—forging livelihoods and nourishing lives. For more information, visit www.vitarich.com or contact ir@vitarich.com