SANTA PAULA, CA - Limoneira Company announced that it has officially completed its previously announced acquisition of 757 acres of lemon, orange and specialty citrus orchards in San Joaquin Valley for a price of $15.1 million.
"We are pleased to complete the acquisition of the orchards that were part of the Sheldon Ranch leases,” said Harold Edwards, President and Chief Executive Officer of Limoneira. “We have recently acquired approximately 900 acres of land that was previously leased in the highly productive San Joaquin Valley, and this is expected to generate incremental operating results and cash flows resulting from the elimination of lease expense beginning in fiscal year 2016.”
According to a press release, Limoneira’s acquisition closed on December 2, 2015. The orchards, referred to as the Sheldon Ranch leases, were acquired pursuant to purchase options contained in certain operating leases the company has had since 2012, for approximately 1,000 acres of lemon, orange, specialty citrus and other crops. Lease agreements included base rent of $500 per acre, Limoneira says, and contingent rent of 50% of the operating profit of the leased property as defined in the lease agreements. Total rent expense for fiscal year 2015 on the acquired property is estimated to be approximately $1.0 million and was approximately $1.4 million for fiscal year 2014.
Edwards shared that since Limoneira went public in 2010, the company has acquired approximately 3,300 acres of agricultural property totaling approximately $48.5 million. As Limoneira begins to realize cash flow from its recent real estate development agreements, Edwards says the company will remain focused on capitalizing on strategic and accretive acquisition opportunities to further expand its global agribusiness.
