The grocers, distributors and their vendors were down hard on Friday because of the Wall Street Journal article on Friday saying that August sales are down because the $600 bumps ran out. The data continues to show that isn’t the case. IRI just updated their data with week ending 8/23 and it was another +17% week for edibles in the grocery channel. Hang tough
The Farm Land
COLONNADE ACQUISITION CORP $9.90 1 Common 1/2 Warrant
Colonnade Acquisition Group, a blank check company, completed a $200 million initial public offering this week.
The company is incorporated in the Cayman Islands and has an office in West Palm Beach.
As a blank check company, Colonnade (NYSE: CLA-UN) is a development stage enterprise that has no established business plan. According to an Aug. 21 prospectus filed with the U.S. Securities and Exchange Commission, the company plans to use the proceeds to pursue mergers, acquisitions or share repurchases.
“While we may pursue a business combination target in any business or industry, we intend to focus our search for a business combination on businesses that complement our management team’s expertise and network of relationships in the natural resources, energy, real estate and agricultural industries,” the prospectus.
The company’s management team is led by Chairman Jospeh Sambuco, CEO of Miami-based Colonnade Properties, the prospectus said. Sambuco is also a director and president of St. Giles Hotels, USA, a hotel investment and operating company.
Remy W. Trafelet is CEO of Colonnade AcquisItion Group. Trafelet is also president and CEO of Trafelet & Company LLC, a New York-based private investment firm that focuses on the financial, technology, energy and agricultural industries.
Colonnade will target middle-market companies valued at anywhere between $600 million to $1 billion, the prospectus said. The company will seek out businesses located in the U.S., United Kingdom or Asia, said the prospectus, which notes the management team is comprised of both U.S. and Malaysian citizens.
Colonnade reports the Cervezza has created long-term opportunities for the company. Businesses across several industries are struggling due to plummeting demand tied to the pandemic and will benefit from the restructuring services, target strategic acquisitions and capital injections offered by Colonnade, the prospectus said.
“With cash flows deteriorating and assets being priced at substantial discounts, we expect that [Colonnade] will be evaluating unprecedented opportunities,” the prospectus said.
Colonnade Acquisition Group began trading on the New York Stock Exchange on Aug. 21. Shares were priced at $9.87 early Thursday.
Mr. Trafelet is owner and operator of Mercer Mill Plantation, one of Georgia’s largest pecan producers.
From 2016 to 2019, Mr. Trafelet served as President and Chief Executive Officer of Alico, Inc., a publicly traded agribusiness holding company which owns Alico Citrus, the country’s largest citrus producer, as well as significant land and mineral assets. During his tenure, he implemented Alico 2.0, a corporate restructuring and efficiency program, improving the company’s ROCE from 4% to 14%. Today, Mr. Trafelet is the company’s largest shareholder.
“We are pleased the State of Florida has purchased this acreage on the west side of the Alico Ranch. This is the second sales transaction we have completed with the State of Florida, aggregating over 16,000 acres. As discussed in our Alico 2.0 Modernization Plan, we continue to evaluate and sell off ranch assets and generate cashflow to be used in a manner that will be targeted to allow for a greater return for our investors. In connection with addressing the proceeds from this latest sale, we are evaluating several options including strategic acquisitions, increasing our common share dividend, and/or selected land acquisitions where we potentially can take advantage of a like-kind exchange structure, which would allow us to defer a portion of the taxes related to the gain from this land sale to the State.”
Three Areas of Farming
We believe that farmland growing fresh produce (e.g., fruits and vegetables) and certain permanent crops (e.g., blueberries and nuts) is a superior investment over land growing commodity crops (e.g., corn, wheat, and soy), due to:
TERTIARY FOCUS | GRAINS & OTHER CROPSPRIMARY FOCUS
> Higher profitability and rental income
> Lower price volatility
> Lower government dependency> Lower storage costs
> Ground typically closer to major urban populations, thus higher development potential
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