SANTA PAULA, CA - Last year, Limoneira announced the sale of its Oxnard, California, packing facility, as well as its Sevilla property in Santa Maria, California. Now, the citrus provider has closed the sale of its Northern properties to PGIM Agricultural Investments (PAI) for $99 million.

"We expect the $100 million Northern properties transaction will be accretive to EBITDA and earnings on a pro forma basis. In addition, it is a great example of the planned expansion of our asset-light supply chain as we pivot toward being a service provider as a farm manager and packer, marketer, and seller of the lemons harvested from these properties,” Harold Edwards, President and Chief Executive Officer, stated. “The proceeds from the sale will significantly reduce our overall debt and allow us greater flexibility to consider a broad range of strategic opportunities and then selectively pursue those that will maximize value for our stockholders.”

The property consists of 3,537 acres of land in Tulare County, California, and has 2,700 planted acres. According to a release, the property also contains 231 acres of plantable ground and 606 acres of open space.

As part of the transaction, Limoneira and PAI entered into a Farm Management Agreement for Limoneira to provide farming services related to the property for an initial term of one year. Limoneira and PAI also entered into a Grower Packing & Marketing Agreement for the citrus supplier to provide packing, marketing, and selling services for lemons harvested on the property for a five-year minimum period.

“During the past three months, we have sold approximately $130 million of the $150 million of non-strategic assets identified for sale and are exceeding our internal timeline and valuation projections,” continued Edwards. “Moving forward, we will continue to advance our asset-light model as we focus on the best use of our valuable portfolio of agricultural lands, real estate properties, and water rights, along with utilizing our expertise in packing, marketing, and distributing to increase our grower partners.”

This sale is part of Limoneira’s Strategic Plan that was established by its Board of Directors at the start of 2022. Within the next 12–18 months, the provider is looking to:

• Transition One World of Citrus™ to an “asset-light” model
• Streamline operations and sell non-strategic assets
• Improve consistency of earnings
• Increase EBITDA and Dividend Per Share
• Reduce debt and right-size the balance sheet
• Improve Return on Invested Capital (ROIC)

To learn more about this transaction, click here.

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Limoneira