Upon conclusion of the purchase, AppHarvest Inc. (NASD: APPH) saw a 9.21% increase in price to $0.6250 in the current market on Tuesday.
Which transaction has APPH closed?
AppHarvest (APPH) reported today that it has inaugurated its 60-acre high-tech indoor farm in Richmond, Kentucky and that it has concluded the sale-leaseback of its indoor leafy greens farm in Berea, Kentucky, for slightly over $127 million.
Mastronardi Berea LLC, a partnership involving Mastronardi Produce and COFRA Holding, and AppHarvest have a contract in place. The high-tech indoor farm for leafy greens in Berea is being sold leaseback by APPH for about $127 million with a lease contract rate of 7.5% over ten years, with four extension terms of five years each.
Mastronardi Produce, APPH’s sole distribution, and marketing partner has supplied some of the biggest national grocery store chains, eateries, and food service establishments with AppHarvest’s produce, including tomatoes, leafy greens, and strawberries. The first two years of prepayment rent at the Berea site as well as the previously disclosed $30 million bridging credit from Mastronardi Produce to APPH would also be returned in part with the profits of the sale-leaseback.
The APPH team worked tirelessly this year to get the four-farm network up and running, and their efforts paid off when the number of farms in their network quadrupled and their crop portfolio was diversified. APPH is now concentrating on operations to increase output and income from the four high-tech farms.
Additionally, APPH revealed that its Richmond, Kentucky, the farm is now operational and has started producing Campari brand tomatoes. Early January is when the first harvest at Richmond is projected to occur, which means that AppHarvest will likely get commercial shipments for the first time from each of its four farms. The Richmond farm is now planted in half, with planting on the remaining portion scheduled for 2023.
How is APPH still developing?
AppHarvest (APPH) has doubled the number of farms running in its network in 2022, in what the business considers to be the greatest parallel expansion out of environmentally controlled agricultural infrastructure in U.S. history. APPH has already established two other high-tech indoor farms this year: a 30-acre field for strawberries and cucumbers in Somerset, Kentucky, and a 15-acre farm for leafy greens in Berea, Kentucky.
