Americold Realty Trust to Close $1.7B Acquisition
- Oct 14, 2020
Americold Realty Trust, the world’s largest publicly traded REIT focused on temperature-controlled warehouses, continues to expand its cold storage footprint around the globe with the planned acquisition of Agro Merchants Group for $1.74 billion from an investors group led by funds managed by Oaktree Capital Management LP. Agro is the fourth-largest temperature-controlled warehouse company in the world, the third-largest in Europe and the fourth-largest in the U.S.
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Once the deal closes later this year or in early 2021, Americold will acquire the Agro portfolio, which serves more than 2,900 customers in 10 countries. Upon closing, Americold’s portfolio, including owned and managed sites, will consist of 229 facilities, totaling about 1.35 billion cubic feet across four continents.
The Agro portfolio consists of 46 facilities in 10 countries totaling 236 million cubic feet. There are 17 facilities in the U.S. totaling 115 million cubic feet in eight states including New Jersey and California, as well as 26 facilities in Europe totaling 111 million cubic feet that are located in the U.K., Netherlands, Portugal, Ireland, Austria, Spain and Poland. Agro has two facilities in Brisbane, Australia, and a 65 percent interest in a one-facility operator in Chile. The portfolio also has a 22.1 percent interest in a joint venture with Comfrio Soluções Logística, which operates 13 facilities in Brazil. The deal also calls for Americold to acquire Agro’s in place call options to purchase the unowned interests in Chile and Brazil.
Fred Boehler, president & CEO of Atlanta-based Americold Realty Trust, said in a prepared statement the acquisition would expand and enhance the geographic reach of the Americold network. He said the Agro deal represented an opportunity to acquire an institutional-quality global network that facilitates the company’s strategic entry into Europe and adds complementary locations in the U.S., South America and Australia.
The definitive agreement calls for Oaktree and Agro management to take 14.2 million shares in COLD common stock subject to lockup until May 17, 2021. The acquisition is valued at approximately $1.74 billion, consisting of $554.3 million in Americold common shares, also subject to lockup until May 17, 2021, as well as $519 million in cash, repayment of approximately $560 million in Agro debt and assumption of approximately $110 million of in-place Agro capital leases and sale leaseback financing obligations.
Citigroup is acting as exclusive financial advisor. King & Spalding LLP and Freshfields Bruckhaus Deringer are legal advisors to Americold. Moelis & Co. LLC is acting as exclusive financial advisor and Latham & Watkins LLP is legal advisor to Agro.
Americold has been expanding its holdings in recent years. In November 2019, the REIT signed an agreement to purchase Nova Cold Logistics, a Canadian temperature-controlled warehouse operator owned by Brookfield Business Partners L.P., and institutional partners, for $254 million. The portfolio had three locations in Toronto, Calgary and Halifax that totaled 23.5 million cubic feet and additional acreage for future expansions. At the same time, Americold acquired two U.S. cold storage facilities for $54 million from MHW Group Inc. The locations in Chambersburg, Pa., and Perryville, Md., were both rail-served facilities and added 19 million cubic feet and land for future expansion to the REIT’s holdings.
Last month, Americold acquired three cold storage facilities totaling 17 million cubic feet in Florida and Texas in two transactions valued at $107.5 million. The purchase of Caspers Cold Storage in Tampa, Fla., for $25 million added 3.2 million cubic feet. Americold also purchased two facilities from AM-C Warehouses in the Dallas-Fort Worth area for $82.5 million. One was an 8.6 million cubic-foot facility in Mansfield, Texas, that included land for future expansion. The second facility with 5.2 million cubic feet was located in Grand Prairie, Texas.
In February, Americold entered into a joint venture to purchase about 15 percent of SuperFrio Armazéns Gerais SA, a temperature-controlled storage operator in Brazil. At the time, SuperFrio operated 16 facilities, totaling 35.1 million cubic feet. Valued at about $28 million, the deal included a provision giving Americold the option to acquire full ownership of SuperFrio starting in 2023.