7 Apr 2020

Pandemic kills off Israel agritech move

4:22 pm on 7 April 2020

The Covid-19 crisis has killed off a planned expansion of New Zealand agritech into Israel.

Farmer-owned co-operative, Livestock Improvement Corporation, had planned to buy a 50 percent stake in an Israeli company, Afimilk.

LIC machine testing milk samples.

LIC machine testing milk samples. Photo: Supplied / LIC

The deal would have cost $US70 million, and was supported by the LIC board.

But when the matter was put to LIC shareholders, 70.30 percent of shares voted against the proposal, 27.56 percent voted for the proposal and 2.14 percent abstained.

"When we announced this proposal, no one could have foreseen the rapid and unprecedented impacts of COVID-19," LIC chairman Murray King said.

He said the board thought the buy-in to Afimilk was necessary to stay ahead of competition in dairy farming technology, but he respected the view of the company shareholders.

When the deal was announced, the cost in US dollars would have amounted to $NZ109 million.

The subsequent fall in the value of the New Zealand dollar pushed the price up to $NZ118 million.

Afimilk produces milk meters, behaviour sensors, and farm management software, which was intended to reinforce LIC's own agritech developments.

LIC is a 110-year-old farmer-owned co-operative that focuses on agritech for the dairy industry.

Afimilk is a trading branch of a partly-privatised kibbutz in the northern Israeli town of Afikim.

LIC now plans to focus on its domestic business.