Select Harvests will be acquiring the Piangil Almond Orchard at a price of $129m. The acquisition will be funded by a mix of capital raising and debt.

UBS expects the acquisition to be low-mid single-digit earnings per share accretive (FY22-basis) and is expected to add 20% to Select Harvest's FY20 estimated volume.

The rationale behind the deal is considered to be solid by UBS due to increased scale of owned almond operations close to Select Harvest's Carina West facility.

Buy rating retained. Target is unchanged at $7.75.

Sector: Food, Beverage & Tobacco.

Target price is $7.75.Current Price is $5.46. Difference: $2.29 - (brackets indicate current price is over target). If SHV meets the UBS target it will return approximately 30% (excluding dividends, fees and charges - negative figures indicate an expected loss).

© 2020 Acquisdata Pty Ltd., source FN Arena