Potato firm seeks £15m AIM listing

ONE of Scotland's largest agricultural companies is to raise £15 million to help fund a major expansion when it lists on the Alternative Investment Market (AIM) later this month.

Borders-based chief executive of Produce Investments, Angus Armstrong, told Scotland on Sunday that the move was "great news" for Scottish agriculture and would give the company the firepower to take advantages of opportunities to significantly expand the business.

Produce Investments, which supplies potatoes to the likes of Tesco and Sainsbury's, employs about 200 at its operations in Duns, Berwickshire and Perthshire.

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The company, better known by its Greenvale subsidiary name and which grows, packs and also develops new potato varieties, already has a number of specific targets although Armstrong wouldn't be drawn further.

He said the company would also look at acquisitions outside potatoes "but only if the opportunities look sensible".

Unusually for Initial Public Offerings, existing investors in the company are purchasing additional equity, a move Armstrong said indicated "an even greater level of commitment to the future of the business".

Current backers include Credential Produce, an investment vehicle of Glasgow-based property developer Barrie Clapham who heads Credential Holdings.

Other executive and non-executive directors are increasing their stakes and the company has appointed Sir David Naish, a former president of the National Farmers' Union and former chairman of Arla Foods (UK).

Produce Investments is expected to have a market capitalisation of between 30m to 40m when shares start trading on 15 November.

The company employs 830 people in Scotland and England. Along with Airdrie-based Albert Bartlett it is one of the big three potato growers and packers in the UK.

It owns a Perthshire-based seed potato operation business which works closely with the Scottish Crop Research Institute in developing varieties, a 33 per cent stake in Organic Potato Growers (Scotland) which grows produce in Morayshire and Inverness-shire, and a similar-sized stake in a Czech-based potato company, BROP.

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Produce Investments' accounts for the year to 26 June show it made a 3.9m profit on a turnover of 156.3m.