Adelaide-based sustainable agriculture trailblazer Sundrop Farms has sold its solar thermal powered, arid-zone greenhouse business to New Zealand-based infrastructure group Morrison & Co.
Reports on Wednesday said Sundrop had been acquired by Morrison & Co for an undisclosed amount, after a year-long negotiation process.
As we have reported on RE, Sundrop was behind the world-leading, concentrated solar power (CSP) tower plant that supplies electricity, heat and desalinated seawater to grow tomatoes in the desert of Port Augusta, South Australia.
The venture was back in its early days by the federal government’s Clean Energy Finance Corporation, and then in 2014 – in the midst of a renewable energy investment drought in Australia – secured a $100 million equity investment from Kohlberg Kravis Roberts (KKR).
The Port Augusta concentrated solar power tower system, developed by Danish renewables outfit Aalborg, combined a a 51,500m² solar field consisting of more than 23,000 mirror heliostats and a 127 metre solar tower.
The 2016 completion of the $200 million project marked the world’s first commercial-scale facility of its kind using sunlight and seawater to grow 17,000 tonnes of truss tomatoes a year, to be sold through Coles supermarkets via a 10-year offtake agreement.
The sale of the business – which includes pilot plants in Tennessee and Portugal – to Morrison & Co is believed to mark that company’s first acquisition for its specialist $1 billion ‘green’ infrastructure fund.
The Morrison & Co Growth Infrastructure Fund – which received a cornerstone investment of $150 million from the CEFC – was established to buy and manage a range of assets where there is potential for significant improvements in their energy efficiency profile.
As noted above, no figures have been released around the sale, although a Financial Review article from February put the deal’s value at between $200 million and $250 million, according to sources.
ABC Online quoted Sundrop Farms CEO Steve Marafiote as saying only that the final price was “in-line with parting and incoming shareholders’ expectations.”
The AFR also reported that KKR, which is advised by Investec, was expected to sell out of Sundrop in full as part of the transaction.
“We’ve been looking for a long time to participate in the food and agriculture supply chain and Sundrop is a great example of that,” said Morrison and Co. chief investment officer Paul Newfield in comments on the sale.
“We’re excited about this as our first investment and we see it as a space where there will be a lot of opportunity for growth.”
Newfield also said that the Port Augusta facility would remain the fund’s top priority over the pilot plants in Tennessee and Portugal.