MINNEAPOLIS - Lendway, Inc. (NASDAQ:LDWY), a specialty agriculture and finance company, has announced the acquisition of a majority stake in Bloomia B.V., a prominent producer of fresh cut tulips in the United States. The deal, which closed today, is valued at approximately $47.5 million in cash and is expected to support Lendway's strategy for long-term growth.
Bloomia, originally established in the Netherlands, has expanded to become a significant player in the tulip industry, producing over 75 million stems annually. With operations in the United States, Netherlands, South Africa, and a strategic partnership in Chile, Bloomia has developed strong retail partnerships within the U.S. market.
Lendway's subsidiary, Tulp 24.1, LLC, acquired 100% of Bloomia's ownership interests, financed through a combination of a new credit facility, bridge loans, and cash on hand. Following the acquisition, Lendway now holds an 81.4% interest in Tulp 24.1, LLC, becoming its sole managing member, with Werner Jansen, Bloomia's CEO, as the only other member.
Mark Jundt, Chair of Lendway's Board of Directors, expressed enthusiasm for the acquisition, highlighting the alignment with the company's specialty agriculture and finance strategy and the potential for stockholder value growth. Jansen also conveyed excitement about Bloomia's integration into Lendway, emphasizing the growth opportunities presented by this capital partnership.
Nick Swenson, a Lendway Board member, endorsed the transaction, noting its strategic timing and its role in reinforcing Lendway's growth trajectory and evolution as a specialty ag and finance company.
Lendway, Inc., which also owns FarmlandCredit.com, is focused on agricultural investments in the U.S. and internationally. The company's expansion into the floral industry with Bloomia's acquisition marks a significant step in diversifying its portfolio.
The company's advisors for the transaction included CapFit as financial adviser and JB Law and Faegre Drinker as legal advisers.
This news is based on a press release statement.
InvestingPro Insights
As Lendway, Inc. (NASDAQ:LDWY) embraces its strategic acquisition of Bloomia B.V., the company's financial health and stock performance metrics from InvestingPro offer insightful perspectives. Lendway's management has demonstrated confidence in the company's value through aggressive share buybacks, a move often seen as a bullish signal by investors. Moreover, Lendway's strong liquidity position is highlighted by its cash reserves exceeding its debt, which could provide the company with a solid foundation to support its growth initiatives and navigate the capital-intensive agricultural sector.
InvestingPro Data reveals that Lendway has a market capitalization of $7.52 million and is trading at a low Price / Book multiple of 0.47 as of the last twelve months ending Q3 2023, suggesting that the stock may be undervalued relative to the company's book value. Despite the challenges indicated by weak gross profit margins of 17.56% in the same period, Lendway has been profitable over the last twelve months, which could be a sign of its operational resilience.
InvestingPro Tips indicate that while Lendway is not paying dividends, which may be a consideration for income-focused investors, the company's liquid assets exceed its short-term obligations, providing a cushion for near-term financial needs. Furthermore, Lendway's stock price has experienced significant volatility and is trading near its 52-week low, which might represent a potential entry point for value investors.
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