Costa’s new CEO Sean Hallahan told an investor call on that while both companies were selling into the Asian market, 60 per cent of 2PH’s volume was going to export and “a lot” of that into China.

The company said it planned to raise $190 million to fund the acquisition, offering one new share at $3 for every 6.3 shares investors already hold.

The deal also includes $31 million for a property in Emerald, Queensland, where 2PH has planted a new citrus crop that will be operational by July 2023.

2PH owner Craig Pressler said the companies had a strong relationship, having been domestic marketing partners for the last 10 years.

Pressler said: “I know and trust Costa, and I am happy that the business will be owned and run by an Australian company which is not only an industry leader but also has a genuine commitment to continuing to build on 2PH’s reputation for the growing and export of high-quality citrus.”

The company is the largest citrus grower in norther Australia, with most of its plantings yet to reach maturity. Costa said that meant its annual yield was forecast to grow from around 30,000 tonnes in CY21 to 60,000 tonnes by CY25.

In addition to providing greater export supply to China and other Asian markets, Costa Group said the acquisition would increase its total citrus plantings by 60 per cent, number of growing regions from two to three, farming locations to 11 and its citrus category revenue by 5 per cent to 35 per cent.

Hallahan said production scale, increased variety offering, rights to commercialise varieties with plant breeder rights, and access to 2PH’s proven 30-year proprietary breeding program were key strategic benefits.

“Costa has been actively engaged in the acquisition of high-quality citrus assets, including our recent acquisition of KW Orchards (Sunraysia) in March 2021. 2PH is not only a high-quality asset, but it will also complement and enhance our production footprint, our variety offering and market opportunities, both export and domestic,” he said.

In a 1HCY21 trading update, the company said it expected to be marginally ahead of the prior comparable period. Its unaudited forecast first half results are $627 million, EBITDA-S $124 million, and NPAT-S $44 million.