Biobest To Acquire Majority Stake in Biotrop

Key Takeaways

1. Biobest Group N.V. acquires 85% of Biotrop Participações s.a, a leading player in Brazil’s biological market.
2. The deal is valued at BRL 2.8 billion (EUR 532 million) and is expected to close by year-end.
3. Biobest aims to expand its presence in South America and diversify its portfolio to include broader agricultural markets.
4. The acquisition is financed through a capital increase from existing and new shareholders.
5. The deal is a landmark transaction for Biobest, tapping into Brazil’s rapidly growing biocontrol market, estimated at over USD 1 billion.

Biobest Group N.V. (“Biobest”) and Aqua Capital, GIC, and Biotrop management jointly announced a binding agreement for the acquisition of Biotrop Participações s.a (“Biotrop”). The deal is set to significantly expand Biobest’s footprint in Brazil’s rapidly growing biological market.

Details of the Acquisition

The company will acquire 85% of Biotrop’s shares based on an enterprise value of BRL 2.8 billion (EUR 532 million) on a fully diluted basis. Biobest will acquire the remaining 15% after a transition period of three years. The transaction is expected to close before the end of the year, subject to customary closing conditions.

Financing the Deal

To finance the acquisition, the company will proceed with a capital increase. This will be subscribed by some of its existing shareholders, including Sofina, some Belgian families, and management, as well as by new shareholders, such as Tikehau Capital, M&G Investments, Unigrains, Sofiprotéol, and several families close to its majority shareholder, Floridienne.

Strategic Implications

The acquisition is part of Biobest’s ambitious M&A strategy to promote biological integrated pest control. This transaction allows Biobest to take a major position in South America and to start its transformation journey from a horticulture biocontrol and pollination specialist to a major biological player in agriculture. This includes covering biocontrol, inoculants, biostimulants, and pollination in covered and open-field crops.

The Booming Brazilian Market

The Brazilian market for biocontrol and other biologicals is estimated at more than USD 1 billion, with an annual growth rate of 43%. Biobest CEO Jean-Marc Vandoorne stated, “Brazil outpaces growth in any other major market,” highlighting the significance of this acquisition.

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