Cadiz Incorporated, a water development and agricultural resource firm, recently announced that it has reached an agreement in principle to combine the business of Sun World International, the wholly owned agricultural subsidiary of Cadiz, with Egyptian-based Kingdom Agricultural Development Company (KADCO).
According to the agreement, KADCO's shareholders will have a 49.75 percent interest in the combined business, while Cadiz will retain an ownership interest of 50.25 percent, stated a press release.
The proposed combination is subject to the negotiation of definitive agreements and a number of other important conditions, including procurement of governmental, third-party and lender approvals and completion of confirmatory due diligence by both parties and KADCO's completion of additional equity financing. It is anticipated that the combination will be consummated by April 2002.
KADCO owns, and is currently engaged in, the development of approximately 100,000 acres of land and associated water resources forming part of the Tushka Project in Southern Egypt, and prior to the proposed combination, expects to have cash resources of approximately $85 million.
Sun World has extensive farming and packing operations in southern and central California, and is engaged in the development and marketing of proprietary varieties of fresh produce internationally.
The proposed combination is expected to consolidate the existing Sun World-KADCO relationship, which was first established in 1999 when Sun World was selected as exclusive manager for the development of KADCO's Egyptian agricultural project.
Founded in 1983, Cadiz is a publicly held water development and agricultural resources company. With its subsidiary, Sun World International, Cadiz is one of the largest vertically integrated agricultural companies in California. The company owns significant landholdings with substantial water resources throughout California.
KADCO was formed by Prince Alwaleed Bin Talal Bin AbdulAziz Alsaud to develop up to 100,000 acres of agricultural land in southern Egypt, naming it the Tushka Project. The Tushka Project is a cornerstone in the Egyptian government's multi-billion dollar South Valley Project, an immense infrastructure plan designed to irrigate more than 500,000 acres of desert land to foster urban and agricultural development. — (menareport.com)
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