ADM in talks to acquire Neovia
The deal, it said, would widen its reach, from both a geographical and portfolio perspective.
Neovia, owned by French agricultural cooperative group, has a turnover of €1.7bn in seven business lines: complete feed, aquaculture, petcare, premix/firm services, additives and ingredients, animal health and analysis laboratories. It has 75 production sites and 8,300 employees in 28 countries.
Neovia's premix and services division, Wisium, renewed its partnership with Korean feed producer, Jeil Feed on June 28.
That alliance is aimed at enhancing the Korean company's know-how in R&D and innovation, particularly in the areas of efficiency and sustainability. Jeil Feed has seven feed plants in Korea and two in China, producing 1.4 million tons of feed per year.
Private equity firm, Eurazeo, took a 17% stake in the company in 2015.
We talked to Pierre-Christophe Duprat, ADM President Europe, Middle East and Africa (EMEA), to hear more about why the French company appeals.
“We like the [growth] trajectory that it had recently. Three years ago a minority shareholder joined Neovia in order to give them more equity and for it to be able to do more acquisitions. It [has enhanced] its portfolio, going to more value added solutions for animal nutrition including premixes, additives and ingredients but also developing in the pet food and aqua feed - strong segments in the feed industry – this is what we like about Neovia.
“But it is not only that. It is also the geographical reach that it has. It is not only in Europe, it is strong in Southeast Asia, it is strong in Brazil and in Mexico as well. The ADM [animal nutrition] business is mainly in North America and China and has been developing quite well recently but bringing the two businesses together would make ADM a global leader [in animal nutrition].”
Indeed, Neovia strengthened its foothold in Africa last month buying up a Nigeria premix firm, Hi Nutrients.
In terms of on how advanced the negotiations are with the French player, shareholders, including the minority shareholders, have signed off on the deal but the employee representatives at Neovia still need to give their views on the acquisition, he said.
“We aim at acquiring 100% of the company. All the shareholders intend to sell us the shares. We hope it [the deal] will come to a conclusion after the [employee approval] step and also some regulatory filings around the end of the year – November or December.”
Probiotics deal
Meanwhile, last week saw ADM announced it had reached agreement to acquire Probiotics International Limited (PIL), a UK based provider of probiotic supplements for human, pet, and livestock and farmed fish use.
The all-cash transaction is valued at £185m (US$242m), subject to customary adjustments.
ADM expects this probiotics acquisition, which is subject to regulatory review, to close in the third quarter
