Australian rural services group Elders is selling off its citrus and stonefruit operations in the country as part of a move by its parent company Futuris to drop the group’s non-core assets.
MD of Elders Rural Services Mike Guerin said the decision to cease non-core operations followed a three-month review of the business by the firm’s new 30-strong senior management team that began in March. “What we found in the review is that under-investment in our traditional core businesses like wool, livestock and horticulture inputs has caused us to lose a little ground to our competitors in these areas. On the back of that, we decided to focus our resources on these core operations,” he told Fruitnet.com.
Elders made a decisive step to develop its horticulture packing and export trading activities two years ago. In November 2006, it purchased the former Golden Circle citrus packhouse in Griffith, New South Wales, before going on to acquire the Gallo Orchards stonefruit growing and packhouse operation in Renmark, South Australia, in June last year.
Mr Guerin said that Elders is now looking to sell both operations as going concerns. “We have tried growing and packing fruit over the past 18 months, but found that others are more qualified to handle these businesses,” he said. “We’re not adding value to these industries, and they’re diverting resources from our core operations, hence the decision to sell up.”
Nevertheless, Mr Guerin stressed that Elders plans to step up its role in the horticulture industry as a supplier of inputs. It will also continue to trade fresh produce on behalf of growers, using its network of international offices. “Our GM of horticulture Nick Kemp heads up a small trading desk and we still export products like table grapes,” he noted. “The investment programme that we have drawn up on the back of our review is the biggest in our history, and investment in horticulture is a significant part of this.”
