Syngenta Group announced the acquisition of Valagro, a leading biologics company - giving the firm a key leadership position in a market that is set to nearly double in size over the next five years.
“This acquisition underlines our growth ambitions in this area and positions us as one of the strongest players in the global biologicals market. The investment also forms part of our $2 billion commitment to help farmers address the effects of climate change and improve agricultural sustainability as part of our Good Growth Plan,” noted Erik Fyrwald, CEO of Syngenta Group, in a release.
Headquartered in Atessa, Italy, Valagro has a market-leading position in biostimulants and specialty nutrients, with an approximate revenue of $175 million in 2019. In the U.S., Valagro is based in Florida; its products are used on row crops, fruits and vegetables.
“For 40 years our mission at Valagro has been to harness nature in order to help farmers achieve higher yields and grow better quality crops,” explained Valagro CEO Giuseppe Natale during an interview with Agri-Pulse. He said the company was originally focused on specialty crops but has expanded to row crops.
“Today, the world recognizes the importance that this category could play, helping the grower and the farmer to produce in a more sustainable way. He said that given the “resources and ambition” of Syngenta Crop Protection, the agreement will “open up new, previously unimaginable growth prospects for the Valagro group worldwide.”
Valagro serves customers around the world with a strong presence in Europe and North America, as well as a growing footprint in Asia, including China, and Latin America. The firm has over 700 employees, 13 subsidiaries and 8 production sites around the world, with a portfolio backed by best-in-class biological R&D, production and commercialization capabilities.
Valagro will continue to operate as an independent brand in the market within the Syngenta Crop Protection business.
Syngenta currently markets a few biological products, but this acquisition will dramatically expand the firm’s portfolio at a time when many analysts predict strong growth in the biologics market.
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The traditional global crop protection category is expected to grow by 2-3% compound annual growth rate over the next five years while biologicals are expected to grow 10% over that same time, noted Corey Huck, head, global biologicals with Syngenta. Keep in mind that global crop protection sales are about $60 billion while the biologicals market is about $4 billion.
“What's really interesting where that growth is going to happen,” Huck said while noting the complementary nature of the different technologies.
“We see the biostimulants area, and the plant health and nutrient use efficiency area, growing at a disproportionate rate of that biologicals growth,” Huck added. “With climate change and everything else that's coming at that plant, making the plant more resilient is really what our objective is with plant biostimulants. We can probably have the biggest growth and the biggest opportunity by having healthier plants so we're less reliant only on biotic stress management practices.
“This is really about a science-driven acquisition, looking at how we can bring better tools to the growers as one. This whole idea around the common thread of sustainability is really important. I think that's really the differentiator between the two companies that really brought us together and will continue to bring us together,” said Huck.
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