Beston postpones tech merger with DataDot; but they’re selling more cheese
Food producer Beston Global has scrapped an agreement to merge its technology business with ASX-listed anti-counterfeiter DataDot.
The pair announced a deal in February to launch a new business that used DataDot’s CSIRO-developed “microdot” watermark technology to stop theft of food products.
Beston’s (ASX:BFC) tech subsidiary Beston Technologies would have merged with DataDot (ASX:DDT) to create a $20 million company.
Today the pair scrapped their initial agreement after concluding “more work is needed to advance the business case to support the intended capital raising” necessary to set up the business.
The pair are now giving themselves until February to decide whether the plan will go ahead at all.
Beston shares were up 8 per cent at 21c just before Wednesday’s close while Datadot was unchanged at 0.3c.
On to a gouda thing
Separately, Beston today signed a cracker of a deal to sell 200 tonnes of mozzarella a month to an unnamed Australian company.
The food manufacturer says that volume accounts for 30 per cent of production from the Jervois plant in South Australia.
It equates to revenue of $1 million a month from that one customer.
Beston doesn’t produce quarterly figures but revenue at the end of December 2017 stood at $19.2 million.
Beston says it starts supplying the new customer this month.
The company’s new cheese factory reached maturity in May, when it ramped up production to 500 tonnes a month, having put the plant into production in February.
Beston shares were up 3 per cent to 20c in early Wednesday trade. The stock has traded between 15c and 31c over the past year.