AgriFORCE Growing Systems Ltd. AGRI an intellectual property-focused AgTech company dedicated to advancing sustainable cultivation and crop processing, has entered into a binding letter of intent to acquire Deroose Plants NV, one of the largest tissue culture propagation companies in the world with a leadership position in horticulture, plantation crops and fruit and vegetables.
The net purchase price by AgriFORCE is expected to be approximately US$69 million. The purchase price represents approximately $46.4 million for the Deroose business on a cash and debt-free basis and $22.6 million for the IP portfolio.
Referring to the recent definitive agreement with Delphy Groep BV (Delphy), Ingo Mueller, CEO of AgriFORCE Growing Systems said the company now looks forward to welcoming Deroose into the AgriFORCE family of companies.
"Our two companies are strongly aligned with transforming the agriculture industry through IP, innovative technologies and expertise that enable cleaner, better crops with reduced environmental impact," Mueller said. "We believe this positions AgriFORCE and Deroose to deliver value by maximizing the sustainability and productivity of available land, especially in tropical climates. In addition, we believe Deroose’s IP provides significant barriers to entry to potential competitors, given the robust patent estate, and typical timelines to research and develop such processes, which could easily exceed a decade. Finally, with the Deroose acquisition, we see opportunities to capitalize on a variety of business synergies, including building on Deroose’s Florida Campus to replicate Delphy’s R&D innovation center for the North American markets.”
Transaction Highlights
The AgriFORCE acquisition of Deroose is expected to provide the following strategic benefits:
- Strengthens AgriFORCE’s integrated AgTech business model by providing a leading position in tissue culture propagation and plant cultivation, including a robust IP portfolio, aimed at delivering increased crop yields with a reduced environmental footprint.
- Enables AgriFORCE and Deroose to drive further growth in core markets for the development and trade of horticulture, plantation crops, as well as fruits and vegetables, building on Deroose’s IP, driving improved genetics and higher yields.
- Building on Deroose’s strong financial performance and consistent growth in multiple locations across the world, AgriFORCE and Deroose plan for additional growth through expansion into new and high-value crops.
“With over 40 years of history, Deroose is a highly innovative company specialized in tissue culture propagation, and we are very excited to join AgriFORCE. Both our IP and vision are highly complementary, as we are committed to growth through the development of new plants, new cultivation techniques, and pursuing new market opportunities," said Maurice van Winden, CEO of Deroose Plants NV. "We are extremely excited about commercializing our new portfolio of genetics for plantation and food crops. We have invested over a decade in development of this IP and believe we can significantly improve the impact that these crops have on the environment while providing much-needed supply sources to the rubber and food industries. Furthermore, strengthening our foothold in North America and accelerating growth into new crops is a strong focus for us in the years ahead.”
Deroose’s unaudited 2021 annual revenues were US $40.5 million with EBITDA of approximately US $4.2 million.
© 2024 Benzinga.com. Benzinga does not provide investment advice. All rights reserved.
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