Supporting our clients, Peacehill Farming Limited

Peacehill Farming Limited is a large and diverse family run company based in Wormit, Fife. The Forster family have farmed at Peacehill since 1926, now in the 4th generation, the business is run by Ross Forster in conjunction with his wife Emma and parents, Peter and Mary. We have acted for the family for over 20 years and recently completed a significant restructure to ensure the business was tax efficient and best placed for future succession planning.

The family are no strangers to diversification, commissioning an anaerobic digestion (AD) plant on the farm in December 2015 of which the company had a 10% stake, with the remaining 90% owned by a UK fund. However, given the amount of work, energy and resources they dedicate to this, they wanted to gain control of the plant and sought advice from our Partner, Scott Greig.

As he already had a close working relationship with the family, Scott understood their plans and set out to help them obtain control without having to fund any of the equity purchase themselves.

Scott commented, “It was clear that the family had ambitious plans to further increase productivity and the efficiency of the plant but were reluctant to undertake the work until they had a controlling interest to ensure the company benefited as much as possible. Therefore, EQ along with several other professional advisors to the company prepared a detailed investment prospectus to attract an investment partner, this included cash flows, management information and operating model assumptions of the plant to provide an overall valuation. Once an investment partner was found, due diligence was undertaken and once agreed, the deal structure was developed to ensure all key commercial objectives were obtained whilst ensuring that the company did not breach any existing debt facility covenants. We worked closely with their bankers and solicitors to complete the series of transactions required in the tight deadline to the benefit of the family.”

As a result, the plant was valued at over £12m and the deal was structured so that the company’s shareholding increased from 10% to 51% without the need to fund the additional equity directly. The family will now see the long-term benefit of the plant and existing feedstock contracts and can turn their plans of increasing productivity and efficiency into a reality.

Ross Forster, Director of Peacehill Farm, added, “Scott’s support and advice throughout this transaction has been invaluable, he truly understands the nature of our business and has helped us achieve our objectives whilst ensuring the best outcome for our family, now and for the future. We know we are in safe hands and that he will continue to contribute to the success of our business for many years to come.”

Along with the AD plant, Peacehill Farm grows a variety of crops including potatoes, broccoli, cauliflower along with energy crops for the AD plant being rye and sugar beet. The business also produces over 2.5million broiler chickens each year and have significant investment in other renewable energy technology including biomass boilers and solar panels. They are part of the East of Scotland Growers co-operative. You can learn more about their business here – http://www.peacehill.co.uk/.

For more information on how we could help your business, contact us by calling one of our offices or emailing corporatefinance@eqaccountants.co.uk.