Agricultural chemical giant Corteva Inc., Indianapolis, Ind., announced on Nov. 30 that it has signed a definitive agreement to acquire Houston-based Stoller Group Inc., one of the largest independent plant science and biologicals companies, for a purchase price of $1.2 billion in cash.
Corteva said the purchase price represents an enterprise value multiple of approximately 12x based on Stoller’s expected EBITDA for 2022 on a stand-alone basis. The acquisition brings immediate scale and profitability, Corteva said, with Stoller projecting revenues of more than $400 million in 2022 from operations in more than 60 countries.
“Biologicals provide farmers with sustainably-advantaged tools that complement crop protection technologies, and collectively, can work to address global challenges around food security and climate change,” said Chuck Magro, Corteva CEO. “In combination with Corteva’s leading innovation organization, Stoller provides a platform for expanding and accelerating Corteva’s biologicals business to become one of the largest players in the rapidly expanding biologicals market.”
Corteva said the purchase price will be paid at closing, which is anticipated to be completed in the first half of 2023 following regulatory approvals and satisfaction of customary closing conditions. Corteva said it expects that Stoller results will be accretive to both operating EBITDA and operating EPS for 2023.
“In Stoller’s 50+ year history, we have successfully helped growers around the world increase their productivity and improve their sustainability,” said Guillermo de la Borda, Stoller CEO. “We are proud to join forces with Corteva as we share a vision of helping farmers succeed in growing the nutritious food the world relies on.”
Bloomberg reported in May that the owners of Stoller were exploring a sale that could value the company at as much as $1.5 billion, including debt. The takeover is Corteva’s second biologicals deal this year, after agreeing to buy Spanish microbiological technologies firm Symborg in September.
The biologicals market is expected to grow high-single digits annually through 2035, representing about 25% of the overall crop protection market by 2035, Corteva said in its statement.
“This announcement is a true testament to the incredible success and dedication of our teams across the globe who have helped us become one of the most trusted biostimulant and plant health companies in the world,” de la Borda added. “Our innovative solutions and deep expertise will continue to make an impact for years to come.”