Staffing and recruitment company PeopleIN (ASX: PPE) - formerly known as People Infrastructure - has announced yet another acquisition, buying food sector staffing business Food Industry People (FIP) for $45 million.
The deal, which may see PPE pay a further $25 million if FIP meets certain EBITDA growth targets in FY23 and FY24, gives PeopleIN a major handhold in the staffing solutions space for the food and agriculture sector.
Established in 2006, Brisbane-based FIP is a national workforce solutions business with around 4,500 people in work, and specifically addresses labour shortages in Australia through the attraction, onshoring and employment of workers from the Pacific Islands under the Pacific Australia Labour Mobility (PALM) Scheme.
FIP workers are typically employed on a fixed term basis for the duration of their visas, and assigned directly to a host employer for the duration of their stay.
The company also provides a dedicated pastoral care program to workers, which includes access to accommodation, transport, healthcare and connecting workers with local community services, churches and sporting clubs.
In addition to the food industry, FIP also secures workers with jobs in the transport, logistics, engineering, maintenance and technical industries.
“PeopleIN has acquired an at scale international recruitment engine room to be leveraged by our defensive growth sectors, including food services, healthcare and aged care,” PeopleIN CEO Ross Thompson said.
“Our investment via the PALM Scheme will help solve the significant employee shortages faced by our clients, and the broader market, by bringing in workforces at scale.”
The company notes it sees ongoing opportunities in the food supply chain space, which has a strong outlook “due to new and ongoing free trade agreements driving growth in exports”.
“In addition, economic recovery from the COVID-19 pandemic is forecast to boost demand for Australian food from international markets over the next five years,” PeopleIN said.
Further, PeopleIN notes that at the beginning of FY22 the Department of Foreign Affairs and Trade announced there were 55,000 work-ready Pacific and Timorese people available to commence work in Australia, demonstrating the expansion opportunities available through the FIP acquisition.
FIP is expected to contribute approximately $9.5 million in EBITDA for FY23 to PPE, and generate earnings per share accretion of 15 per cent.
The target’s CEO Brad Seagrott will join the PeopleIN executive leadership team and continue in his current role following the acquisition which is expected to complete later this month.
Today’s deal is the latest in a series of acquisitions completed by PeopleIN in the past 12 months, including the purchase of specialist recruitment firm Perigon Group and Queensland surveying business Vision Surveys.
Last year, the company announced it bought Melbourne-based SwingShift Nurses for $3.1 million, which followed the purchase of technology staffing business eCareer Employment Services and Illuminate Search and Consulting for $5.15 million.
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