Geelong fresh produce king Frank Costa has fended off reports his family’s $1 billion empire is being primed for sale.
The giant Costa Group was considering several options post-2017, he told the Independent this week.
The group,the biggest fresh-food supplier to Woolworths and Coles, was undergoing a period of growth but keeping its options open, Mr Costa said.
US firm Paine & Partners bought a 50 per cent stake in the company under a five-year plan struck in 2012. The remaining 50 per cent is split between Mr Costa, who chairs the company, and brothers Robert and Anthony.
Costa Group employs 7000 people and exports 20 per cent of its produce.
“The decision was made to build the business over five years with acquisitions and expansions and then we’d decide whether we buy back or buy more shares or go public,” Mr Costa said.
“No decision has been made.”
Financial observers argue the company would go to an offshore buyer if sold. Commentators such as Alan Kohler have claimed the Costas are committed to exiting the group in 2017 but Mr Costa was non-committal.
“That could be a bit of overkill. That’s just one of the options available,” he said.
“We have really good management, our CEO is really good, the business is running really nicely.”
Mr Costa, aged 76, said he would assess his personal future according to his health.
“It would be a big call for us to sell up and get out,” he said.
“It would need strong deliberations by the three brothers. It will be a family decision.”
Mr Costa returned from overseas last week after a business trip with wife Shirley to New York and Paine & Partners’ annual general meeting.
Mr Costa and late brother Adrian founded The Costa Group in 1961 when they bought their father’s greengrocery, Covent Garden. By the mid-1960s they were supplying Coles and Woolies in Geelong and eyeing pastures further afield.
As the supermarkets steadily expanded through the 1970s so did the Costa fortunes. The group is now Australia’s largest private produce grower, marketer and exporter.
Mr Costa laughed off suggestions a sale to an offshore buyer might damage the national deficit but said Australia’s agricultural future lay in farm consolidations, greater produce varieties and exports to Asia.
He said Chinese efforts to finance Australian agricultural projects should be granted greater support, arguing they could elevate agribusiness to a “whole other level”.
— NOEL MURPHY
