AgriFORCE Growing Systems Signs Definitive Agreement to Acquire Delphy, a Leading European Agriculture/Horticulture and AgTech Consulting Firm
February 15 2022 - 8:45AM
AgriFORCE Growing Systems Ltd. (“the
Company") (NASDAQ: AGRI; AGRIW), an IP-focused AgTech
company dedicated to advancing sustainable cultivation and crop
processing across multiple platforms, today announced that it has
entered into a definitive agreement to acquire Delphy Groep BV
(Delphy), a Netherlands-based AgTech consultancy firm, for US$29
million through a combination of cash and stock. This definitive
agreement follows the binding LOI as previously announced in
October 2021.
Delphy, which optimizes production of
plant-based foods and flowers, has multinational operations in
Europe, Asia, Russia, Kazakhstan, and Africa, with approximately
200 employees and consultants. Delphy’s client list includes
agriculture companies, governments, universities, and leading
AgTech suppliers, who turn to the company to drive agricultural
innovation, solutions, and operational expertise. Delphy achieved
2020 annual consulting audited revenues of more than US$26 million
and EBITDA of US$3 million (IFRS-based)1. Delphy expects to end
2021 with revenues of US$28 million
Transaction HighlightsThe
AgriFORCE acquisition of Delphy is expected to provide the
following strategic benefits:
- Delphy has generated strong
historical financial performance and consistent growth.
AgriFORCE plans to build on this growth through expansion of
Delphy’s consulting operations, establishment of a research and
development center in North America, facilitating higher
penetration of its Asian markets, as well as expanding AgriFORCE’s
operations in international markets where Delphy has an established
presence.
- Accelerated deployment of
the AgriFORCE GrowHouse and related IP by leveraging
Delphy’s extensive experience, established customer base, and deep
industry relationships.
- Delphy’s deep industry
knowledge and experience complements AgriFORCE’s M&A
strategy by being uniquely positioned in identifying
regional and international AgTech opportunities.
- Delphy is at the forefront
of knowledge and IP development and research, which the
Company plans to augment with increased revenue from technical
solutions in the controlled-environment agriculture (CEA)
vertical.
- Ability to expand
AgriFORCE’s IP development and increase innovation through
Delphy’s Improvement Centers, its center of excellence R&D
facilities, and its relationships with governments and premier
AgTech universities.
- Delphy brings a team of
industry leaders in AgTech and a market-leading consulting
brand to AgriFORCE.
Ingo Mueller, CEO of AgriFORCE Growing Systems,
commented: “We expect the acquisition of Delphy will be
transformative for the Company, as it significantly enhances the
value proposition that we can offer customers in the AgTech
industry. We expect the combined company will emerge as a global
player with top-tier R&D capabilities, a more diverse product
pipeline, increased IP development capabilities, and a broader
footprint.” He added, “Delphy brings a highly accomplished and
experienced team to the table, and we look forward to leveraging
their capabilities and broad industry relationships. Importantly,
our complementary expertise and shared values are underpinned by a
commitment to making positive change in the lives of farmers and
consumers.”
Jacco van der Wekken, CEO of Delphy, said: “We
believe that partnering with AgriFORCE will help accelerate our
global expansion plans and further establish our industry
leadership. Our collective strategy is to provide innovative
solutions through our deep industry knowledge and first-class
intellectual property. In particular, we look forward to
accelerating the vast opportunities in North America where we see
significant potential to ramp-up revenues and support the rollout
of the AgriFORCE GrowHouse on a global level.”
The transaction closing is expected to occur
within 60 days of the signing date. Post-closing, it is anticipated
that Delphy will become a subsidiary of AgriFORCE and will be
operated by its current management team.
- EBITDA Reconciliation
|
|
2020 |
|
|
|
(in US$ ‘000’s) |
|
Net income |
|
2,391 |
|
Share of profit of
associates |
|
(113 |
) |
Depreciation and
Amortization |
|
274 |
|
Interest expense |
|
28 |
|
Income tax expense |
|
420 |
|
EBITDA |
|
3,000 |
|
|
|
|
|
About DelphyCreated in 2013 by
the merger of DLV – a privately held former Department of the Dutch
Ministry of Agriculture – and GreenQ – a company focusing on
consultancy, education, projects and R&D innovation behind its
Improvement Centres, Delphy is a leading consultancy and R&D
improvement company based in the Netherlands, with over 200
employees and global operations. Delphy’s name is based on the
classical antiquity name 'Delphi' which was the place where people
came together with questions about crops, fertility and harvesting.
Delphy stands for Worldwide Expertise in Food and Flowers.
About AgriFORCEAgriFORCE
Growing Systems Ltd. (NASDAQ: AGRI;
AGRIW) is an AgTech company focused on the
development and acquisition of crop production know-how and
intellectual property augmented by advanced AgTech facilities and
solutions. Looking to serve the global market, the Company’s
current focus is on North America, Europe, and Asia. The AgriFORCE
vision is to be a leader in delivering plant-based foods and
products through advanced and sustainable AgTech solution platforms
that make positive change in the world—from seed to table. The
AgriFORCE goal: Clean. Green. Better. Additional information about
AgriFORCE is available at: www.agriforcegs.com.
This press release contains forward-looking
statements within the meaning of the "safe harbor" provisions of
the Private Securities Litigation Reform Act of 1995. Statements
other than statements of historical facts included in this press
release may constitute forward-looking statements and are not
guarantees of future performance, condition or results and involve
a number of risks and uncertainties. Actual results may differ
materially from those in the forward-looking statements as a result
of a number of factors, including those described from time to time
in our filings with the Securities and Exchange Commission and
elsewhere. The Company undertakes no duty to update any
forward-looking statement made herein. All forward-looking
statements speak only as of the date of this press release.
Company Contact:Ian PedersenTel: (604)
757-0952Email: ipedersen@agriforcegs.com
Investor Relations:Crescendo Communications,
LLCDavid Waldman/Natalya RudmanTel: (212) 671-1021Email:
AGRI@crescendo-ir.com
Media Relations:AHA Creative Strategies
Inc.Ruth AtherleyTel: (604) 846-8461Email: ruth@ahacreative.com
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