31/03/2016 - 01:05

Chinese group buys Kailis Bros

31/03/2016 - 01:05

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The Kailis family has folded its Kailis Bros seafood business into a larger, newly-capitalised venture called KB Foods that will be 90 per cent owned by Hong Kong-listed conglomerate Legend Holdings. Click through to see the multiple WA businesses owned by members of the Kailis family in WA.

 

Chinese group buys Kailis Bros

The Kailis family has folded its Kailis Bros seafood business into a larger, newly-capitalised venture called KB Foods that will be 90 per cent owned by Hong Kong-listed conglomerate Legend Holdings.

KB Foods will be managed by members of the Kailis family, with Matthew to become group CEO while his brothers George and Nicholas Kailis will continue as managing directors.

The Kailis family’s share of KB Foods will be 10 per cent.

The deal excludes the Kailis Bros Leederville café and fish shop and the Perth Fish Markets, trading as AJ Langford Pty Ltd, which will remain 100 per cent owned and operated by the Kailis family.

The terms of the transaction were not disclosed, though the scale of the Kailis Bros business indicates it would be significant.

Kailis Bros has more than 500 employees and disclosed annual sales of $513 million in its latest Australian Securities and Investments Commission return, ranking it the 14th largest private business in Western Australia, according to the BNiQ search engine.

Its operations, based at Canning Vale, encompass seafood processing, wholesaling and exporting.

In a statement issued last night, Matthew Kailis said the deal would support the family’s growth plans.

“We have long-held ambitions to grow our Australian and international business, and greater access to capital will assist with funding organic and inorganic growth opportunities,” he said.

“We are pleased that Kailis Bros is able to partner with Legend in fulfilling our mutual growth ambitions in the exciting food and agriculture space.

“We collectively see significant opportunities in Australia and around the world to build on our strong foundations with investments in fishing and aquaculture, seafood processing and distribution.

“Legend is keen to continue to develop their food and agriculture segment to match their IT segment, which includes brands such as Lenovo and Motorola.”

Legend was established in China in 1984, initially with a focus on the IT sector, but has diversified extensively and has in excess of 60,000 employees.

It is best known for its flagship IT brand Lenovo, but its Joyvio agricultural arm is one of China’s biggest fruit companies. 

Senior vice-president, Shaopeng Chen, said Australia possessed a strong market economy and was a stable place to do business.

Kailis Bros has developed a great reputation in Australia and with our capital backing we intend to invest in the business to grow its Australian operations with new capabilities, new products, new technologies and greater market presence,” Mr Chen said.

The Legend transaction was the culmination of a competitive bid process run by PwC for the family.

Legend's legal adviser was MinterEllison, with a team led by partner Adam Handley and special counsel Bryn Davis, while Kailis was advised by King & Wood Mallesons, led by Nigel Hunt.

Mr Handley said Minter was privileged to have acted as legal advisor to Legend on its first major Australian investment. 

The Kailis network

The Kailis Bros business dates back to 1926, when George Peter Kailis, who migrated to Australia from the Greek island of Kastellorizo in 1914, established a retail fish shop.

He had four sons, who have all made their mark in WA business.

Michael Kailis took over the retail fish shop, which evolved into Kailis Bros. He also had four sons who now run the business.

Theo Kailis partnered with Murray France to establish the renowned Kailis & France fishing business in 1973.

That business was effectively broken up after its food services arm was sold to private equity investors in 2004.

Theo Kailis was also involved in the establishment of Austral Fisheries, which continues as a major business in its own right; it had annual sales last year of $120 million, and recently became the first seafood business in the world to be certified as carbon neutral.

Austral is half-owned by Theo's family through Kailis Fisheries Holdings, with the other half held by Japanese company Maruha Nichiro Corp, which bought its stake in 2013. 

Peter Kailis pioneered the Red Rooster fast food chain in WA, while his son, Mark, established Kailis Organic Olive Groves, which was sold to Chinese interests in 2012.

The fourth son, Victor Kailis, owns and runs the Kailis Fish Market Café in Fremantle and Kailis Trigg Beach with his son, George. He acquired the Trigg cafe in 2012.

The business interests of George P Kailis’s descendants are separate from Fremantle-based company MG Kailis Group, which was established in 1962 by Michael G Kailis and his wife, Patricia Kailis.

That business is now headed by their son, Alex Kailis, whose most recent deal, in June last year, was the sale of its Fremantle marina to the Bennett family.

Folloing the sale, MG Kailis is focused on fishing, ship repairs and jewellery.

The directors of MG Kailis include University of Notre Dame professor George Kailis, who is not to be confused with the George  Kailis at Kailis Bros.

STANDING BY BUSINESS. TRUSTED BY BUSINESS.

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