The sales process for Next Capital’s flower company Lynch is understood to again be ramping up, with strong online sales thought to be behind the decision to launch the contest.
Next Capital was believed to be putting its feelers out around June to test appetite for a sale of the country’s largest wholesaler of floral and potted products.
A sale was understood to have started earlier this year, but was suspended due to the onset of the COVID-19 pandemic.
Whether a sale got off the ground was expected to depend on how quickly travel restrictions were eased, given that interest in the business was expected to come from Asian buyers as well as those in Australia.
But now the understanding is that, like many businesses, Lynch is keen to capitalise on the booming e-commerce trade.
Earlier, the earnings before interest, tax, depreciation and amortisation for Lynch were thought to be about $40m, which could have put a price tag of as much as $400m on the business. But that was before the COVID-19 pandemic.
Stanton Road Partners and Citic-CLSA are advising on a sale.
It is understood last year an Asian buyer showed an interest in Lynch, which prompted Next Capital to place it on the market.
The company specialises in exporting Australian wildflowers throughout the world and describes itself as a global leader in floral innovation, research and development.
It generates revenue from the wholesale of plants and flowers and was purchased by private equity firm Next Capital in 2015.
Founded by Leo Lynch last century, the company has offices in Sydney, Melbourne, Brisbane, Perth and Adelaide. The business began as a flower grower and moved into flower distribution in 1984.
Lynch has established a floral propagation and growing facility in China, where it produces high-quality produce at a material cost advantage to local supply.
Next Capital says Lynch has been successful in driving double-digit organic growth.
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