Costas in $112m share sale
ONE of the nation’s richest families, fruit and vegetable king the Costa family, has revealed its selldown this week of more than $100 million worth of shares in the listed Costa Group was motivated by estate planning.
In a letter sent to Costa chairman Neil Chatfield on Monday afternoon, an entity called Costa AFR Pty Ltd revealed the estate planning issues had been triggered by the sudden death of Anthony Costa earlier this year.
Anthony Costa was the brother of listed Costa Group director and shareholder Frank Costa and Robert Costa, who chairs the Costa’s family office Costa Asset Manage- ment. Together they pioneered the development of Costa Group (CGC), the nation’s largest fruit and vegetable company. Anthony Costa continued to work and consult in the industry until his final days. He passed away in February after a stroke following a surgical procedure.
Monday afternoon’s sale by the family of 17.1 million shares in Costa Group, or 5.3 per cent of the company, generated over $112 million of proceeds.
The sale through UBS was priced at $6.55 a share and leaves the Costa family with a 4.9 per cent holding in Costa Group. Costa shares closed at $6.64 yesterday and have more than doubled in value over the past year.
“It was between Anthony’s estate and my other brother Robert who oversees that,” Frank Costa said. “They thought it was time they looked after the estate. Anthony has lots of children. So it was agreed to sell half of our holding for that reason. I didn’t oppose it.
“They had been talking about it for a while but it only got serious in the past week.
“I think it (Costa Group) is a great company, it is exciting the future it has.’’
The letter to Mr Chatfield also strongly backed the management of Costa Group by chief executive Harry Debney and chief financial officer Linda Kow.
Pre-float investor Paine & Partners sold 14.9 million Costa Group shares last Friday morning at the same price, $6.55, via JPMorgan, to also reduce its holding below the 5 per cent threshold.
The sales came after Costa Group at its AGM last week upgraded its full-year earnings growth guidance to approximately 20 per cent, a substantial increase on the 10 per cent profit growth guidance it provided at its full-year results in August.