In an announcement to the ASX this week, Propel said it had executed a conditional sale agreement to acquire the business, related assets, infrastructure and real estate of Southern Funeral Home which operates from five locations (including a cremation facility) in Gore, Cromwell, Alexandra and Queenstown.
On its website, Propel describes itself as the second-largest private provider of death-care services in Australia and New Zealand.
Southern Funeral Home was the company’s eighth acquisition completed or announced during FY24 YTD.
The consideration payable on completion of the acquisition was about $A4.6m, of which about 65% related to the acquisition of real estate comprising $A4.4m in cash and $A230,000 via the issue of 44,971 Propel ordinary shares on completion of the relevant acquisitions.
In addition, up to $A500,000 would be payable in cash if certain financial milestones were achieved during the four years following completion.
Subject to meeting customary conditions, the acquisition was expected to be completed by June 30.
Graham and Heather Stephen bought a house in Gore in 1996 which was originally destined to form part of a motel complex.
While that never went ahead, the house with a front office was suitable to operate as a funeral home and Stephen Funeral Home was established.
Within five years, two adjacent properties were bought and planning began to demolish the existing houses and build a chapel featuring a catering lounge and foyer to host after-service functions. That development was completed at the end of 2004.
In 2008, the company bought Hammond Funeral Services and rebranded the combined businesses Southern Funeral Home.
Operations continued on the same site in Hokonui Dr.
Mr Stephen followed in his father’s footsteps of funeral directing which initially came about when his grandfather operated a joinery factory in Edendale and made caskets.
The announcement said the business conducted about 270 funerals in its last financial year.
