THE WOODLANDS, TEXAS — RiceBran Technologies on Nov. 30 said it has completed the acquisition of Golden Ridge Rice Mills’ rice milling and rice bran stabilization facility in Wynne, Ark.
Closing of the transaction comes less than a month after RiceBran exercised its option to acquire the assets and operations of Golden Ridge Rice Mills.
Total consideration for Golden Ridge was approximately $7.8 million, including the issuance of 1,666,667 shares of RiceBran common stock, the retirement of approximately $2.2 million of debt at the time of closing, and the assumption of approximately $600,000 of debt. RiceBran said it expects Golden Ridge to add about $20 million in revenue and EBITDA in 2019.
RiceBran said it plans to implement some small short-term capital expenditure projects that will expand capacity at the site and increase EBITDA at Golden Ridge by as much as 30%.
“The acquisition of Golden Ridge is a very important part of our strategic plan to grow the business and build long-term value for our stockholders,” said Brent Rystrom, president and chief executive officer. “Golden Ridge gives us a substantial presence in Arkansas, where more U.S. rice is produced and processed than any other rice-producing state, and provides a source of stabilized rice bran (S.R.B.) that is closer to many of our customers in the Midwest and Eastern U.S., with active and attractive freight lanes. It also gives R.B.T. control over our milling scheduling that will enable us to produce S.R.B. based on our production needs, which should permit us to significantly improve supply chain management and improve gross margins in our S.R.B. business.”
Mr. Rystrom said the acquisition also will leverage RiceBran’s sales force by expanding its product portfolio to initially include the supply of rice, brown rice, brewers’ rice and brokens.
“These are all synergistic ingredients for our target customers, which should enable our team to build more broad-based customer relationships,” he said. “The site also has considerable room for expansion to increase our S.R.B. production capacity as well to house additional product development capacity to further expand our product portfolio. We look forward to integrating Golden Ridge into R.B.T.’s operations as we continue our efforts to grow sales and achieve EBITDA profitability by the second half of 2019.”