NZX looks set to lose another company as billionaire bids for Comvita

Monday, 18 August 2025

The NZX looks set to lose yet another company off its register - with one of New Zealand’s richest men making a bid to take troubled honey producer Comvita private.

The potential buyer of Comvita is Christchurch-based natural health product export business Florenz, a subsidiary of billionaire Mark Stewart’s Masthead Limited. Over a 40-year commercial career, Stewart has been a director of a number of publicly listed companies and, through his family investment company Masthead Ltd, has extensive investments across a range of different industries.

Florenz’ portfolio includes Wedderspoon Organic — North America’s leading seller of mānuka honey products with distribution in more than 23,000 stores — along with Xtend-Life, 2before Sports Nutrition, Dry Food New Zealand, and a one-third stake in Harker Herbals, which is now entering the United States market alongside existing international sales.

This morning, Comvita told the NZX it had entered into an agreement with Florenz by which the latter would purchase all shares in Comvita through a court-approved scheme of arrangement for 80 cents per share, valuing the company at $56 million in “equity value” - or the price a buyer is willing to pay, taking everything into account.

That is quite a discount to Comvita’s “enterprise value” - the value of the business including goodwill, intellectual property and all plant and equipment - which has been put at $119m.

Chairperson Bridget Coates said Comvita’s board unanimously supported the bid, which has already been backed by the company’s two largest shareholders, China Resources Enterprise and Li Wang, who together own 18.3% of the company’s shares on issue.

“In addition, we have confidentially appraised certain institutional shareholders, and they have advised that they are supportive of the offer being put forward to shareholders to consider,” the company said.

Coates said the bid provided greater certainty “amid sustained sector, structural and financial challenges, and the liquidity it offers, given historically low trading volumes.

“Recent years have been challenging for Comvita and its shareholders, with sustained sector pressures, softer market conditions and the demands of a complex turnaround weighing on performance. The board understands the impact this has had and the importance of delivering a clear, decisive path forward,” she said.

“Comvita has faced ongoing pressure from structural changes in the mānuka honey sector, which continues to face oversupply, price and demand volatility, and intense competition (including online). The environment is fragmented, with several participants under financial strain. Industry dynamics require consolidation at pace, but sector leadership demands capital strength, scale and speed, which are not available to Comvita under its current capital structure.”

Building a premium brand to meet demand had been the company’s strategy to ensure sustained growth, with “significant capital”invested in brand equity, distribution reach, supply security and scientific credibility to position Comvita for that opportunity.

But “a number of these investments did not meet their objectives or deliver expected returns. In parallel, market growth did not materialise at the expected pace, competition intensified and oversupply created additional headwinds, reducing profitability,” Coates said.

Stripping out costs and simplifying its operation had not sufficiently strengthened the balance sheet or position the business for long-term sustainability.

“Trading conditions in FY25 have remained challenging and, consistent with previous guidance, Comvita expects to report a significant loss for FY25 as well as a material write-down of the net assets as a result of impairment testing and provision against inventories.”

Crucially, the company’s bankers had given the company a reprieve but “signalled that a longer-term solution - through debt repayment or potential strategic transactions - is required.” A capital raise or refinancing could meet this requirement, but a “defined outcome” - like that being offered by Florenz, would not be forthcoming.

“Florenz brings the capital strength and scale needed to operate in this environment and accelerate Comvita’s growth under a consolidated model. They have expressed their commitment to Comvita’s global team, growing its New Zealand operations, investing in its international markets and lifting the brand’s profile on the world stage. They value the expertise within Comvita, its role as a flagship New Zealand brand and are proud to have the opportunity to keep this iconic company under New Zealand ownership.”

The proposal is subject to shareholder and High Court approval, and an independent adviser’s report being prepared by Grant Samuel that confirms the price Florenz is purporting to pay is fair. Comvita shareholder approval will be sought at a special meeting of shareholders expected to be held in November 2025.

Comvita shares have gained 62.50% this morning and are trading at 0.78cps.