The Mad Butcher will list on the stock exchange next year after being bought by a shell company for $40 million.
Veritas Investments will pay Mad Butcher owner Michael Morton $20 million in cash and another $20 million in Veritas shares.
Mr Morton will remain the chief executive of Mad Butcher while becoming a director and the largest shareholder of Veritas.
It is the first acquisition by Veritas, and chairman Mark Darrow says the board has exciting growth plans for the butchery chain.
He says the chain has 36 stores and there are good growth prospects for opening more stores around New Zealand.
Mr Darrow says Mad Butcher has franchisee stores which collectively turn over $150 million per year and that can be leveraged into other businesses, possibly in butchery but also the wider food sector.
The transaction is subject to shareholder and regulatory approvals, and a shareholder meeting is planned for March 2013.
Veritas also plans to hold a capital-raising early next year to broaden its shareholder base.
The public offer is expected to occur in March 2013. Veritas also intends to undertake a 30:1 share consolidation prior to the offer.
