Acquisition, organic growth boost company, whose sales totaled R$3bn in 2021 and may now reach R$8bn
07/29/2022
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André Dias — Foto: Silvia Zamboni/Valor
Nutrien’s acquisition of the fertilizer distribution network Casa do Adubo will boost the Canadian company’s growth in Brazil. The deal was announced last week and still depends on the antitrust regulator CADE’s greenlight.
The company’s turnover in the country is expected to reach R$8 billion in 2022, compared with R$3 billion last year, says André Dias, Nutrien’s CEO in Latin America. The results will be driven by Casa do Adubo’s sales – expected to reach R$2.5 billion – and organic growth.
Besides the sales that will come from Casa do Adubo’s 39 points of sale in 11 states (Acre, Bahia, Espírito Santo, Maranhão, Mato Grosso, Minas Gerais, Pará, Rio de Janeiro, Rondônia, São Paulo, and Tocantins), the projected value includes the revenue from Marca Agro Mercantil, a Minas Gerais-based chain with seven stores whose acquisition, unveiled at the end of June, also depends on CADE’s approval.
“With the acquisitions, we will have 120 stores and experience centers in Brazil, with a much greater geographic diversification. Our network is in São Paulo, Minas Gerais, Goiás, Tocantins and Mato Grosso do Sul now. With Casa do Adubo, we will reach 13 states,” says Mr. Dias. The value of recent purchases made by Nutrien was not disclosed, but sources in the segment estimate that they have exceeded $2 billion.
Besides the greater amplitude, Casa do Adubo, in particular, brings to the Canadian multinational 100,000 new smaller clients, with properties between 50 and 200 hectares. Currently, the farms of the company’s 7,000 customers are generally between 200 and 2,500 hectares.
“Furthermore, we will have more access to the market of redistribution of agricultural inputs, since Casa do Adubo maintains this channel with smaller networks,” says Mr. Dias. According to him, after seven acquisitions in two years, it is time for Nutrien to focus on the integration of networks to generate greater efficiency in operations. “But we are always looking at the market,” he said amid the Farmer’s Day events held by the company this week, which is celebrated on July 28.
In addition to its growing chain of input distributors, Nutrien – the largest supplier of potassium-based fertilizers in the world, with mines in Canada – also has four fertilizer blending plants in Brazil and plans to open three more.
*By Fernando Lopes — São Paulo
Source: Valor International