Cobram Estate Olives to acquire California Olive Ranch, boost US presence

Cobram Estate Olives Limited (ASX:CBO) has entered a binding agreement to acquire California Olive Ranch, Inc. (COR) for $173.5 million, comprising $88.5 million cash, $70.0 million vendor notes, and a $15.0 million earn-out payment. This acquisition is expected to be circa 9% EPS accretive in FY27F, positioning CBO as a leading producer in the US market. COR, with net assets of $132.6 million at 30 September 2025, manages approximately 1,870 hectares of groves and 2,500+ hectares of contracted third-party groves in California, forecasting $150 million in net revenue and $16 million EBITDA in FY2026.

The acquisition will boost CBO’s Californian olive growing footprint from ~1,422 hectares to ~3,292 hectares, adding established premium brands like California Olive Ranch® and Lucini® Italia. Synergies of $12 million are expected in FY27F, increasing to over $20 million annually by FY30F through improved yields, reduced costs, and operational efficiencies. CBO's FY2026 Californian harvest yielded 3.0 million litres of olive oil, securing total supply of 3.8 million litres for the next 12 months, a 27% increase year-on-year.

For the proposed issue of warrants as part consideration for the acquisition, Cobram Estate Olives Limited will issue up to 30,840,763 warrants with a proposed issue date of 28 February 2031. These warrants will be issued under the entity's 15% placement capacity, without requiring security holder approval.