Company director Paul Letari's family venture Toscana will take a majority share in struggling olive oil producer Frankland River Olive Company to help it recapitalise.
Toscana will increase its share in Frankland from the current 19.3 per cent to an anticipated 71.17 per cent, and also loan the company, which ended the financial year with a $1.8 million loss, $200,000 immediately.
After the takeover bid is complete, Welshpool-based Toscana will loan an additional $800,000.
Toscana is offering to acquire all outstanding Frankland shares at 1.2 cents, well above their current fetching price of 0.8c.
Franklin chairman Craig Readhead said the company was pleased shareholders would be given the option to exit at a price 50 per cent above the current price.
After completion of the takeover, Frankland will undertake a further rights issue to raise around $2.75 million, to be used to pay off bank debt, retire shareholder loans totaling over $2 million, and provide working capital.
Mr Letari, who is a director of Frankland, described Toscana as a private, diversified family company with interest and expertise in industrial property, building, sign manufacturing, cattle farming, pumps and capital equipment trading.
"Agriculture plays an important part in our economy and whilst most focus is on resources we see the importance of agriculture produce for the generations ahead of us," Mr Letari said.
"We are of the firm view that Jingilli olive oil is amongst the finest quality in the world and see growth of this brand globally."
