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Fundings-in-Brief: Syngenta Acquires Ag Connections as Yuanda Injects $180m into Smart Irrigation and PE Activity Rises

October 20, 2015

Welcome to another weekly roundup of the agriculture funding news that didn’t quite make it onto the front pages of AgFunderNews.

Private equity players globally are increasingly making headlines in the sector. After last week’s $600 million worth of ag-related exits, this week a major European private equity buyout firm, BC Partners, bought a majority stake in Dutch flower company Dümmen Orange.

BC Partners’ acquisition was an exit for H2 Equity Partners, a Dutch PE firm, and the Dümmen family. The deal values the company at about €500 million, and 11 times its earnings before EBITDA, reported Agri Investor, citing a source close to the deal. If completed, this deal will be BC Partners’ first agribusiness investment in over 15 years. The firm picked up poultry life sciences group Aviagen in 1998, which it sold to Advent International five years later.

There could be more activity in this segment of the ag market after Syngenta announced plans to sell off both its flower and vegetable seed businesses in August. The Swiss agribusiness is understood to be attracting a wealth of private equity interest for these assets.

Syngenta was in the news this week after acquiring farm management software company Ag Connections, proving the route to exit for many agtech companies could be strategic acquisitions. After working with precision agriculture tool Ag Connections for 14 years on its AgriEdge Excelsior program, Syngenta has acquired the full equity capital of the business, and will now work with the company to accelerate further innovation, according to a statement.

Moving over to Asia, Shenyang Yuanda Enterprise Group, the Chinese conglomerate, has expanded its investment into the agriculture technology sector. The company, known for manufacturing curtain walls for large buildings, first invested in the sector last year when it purchased a 54 percent stake in Israeli smart irrigation system AutoAgronom for $20 million.

After conducting a series of experiments with the technology, which has been developed since 1988 and aims to significantly improve crop yields, Yuanda has increased its investment in AutoAgronom by injecting a further $180 million to expand the business and build a factory in China. AutoAgronom, which is now based out of Boston in the US, monitors moisture in the soil through a variety of sensors and activates irrigation and fertilization when needed.

Merging the farm

There were a few mergers this week starting with US seed company Pinnacle Agriculture Holdings, which is buying up eight regional seed companies. The network of companies will be operated under the name AgVenture Pinnacle and include ProSelect, Seed Services of Nebraska, AVN Seed Partners, AgVenture/GroMor, Shcerr’s Seed, Corn Capital Genetics, Profiseed, and Teays Valley Farms.

Next, an investment firm helping technology companies expand within their industries, Volaris Group bought North Dakota-based Red River Software, which provides mission-critical application software for the agribusiness, fuel, energy, and convenience retail verticals. With current markets covering 35 US states as well as Canada, RRS provides back office accounting, inventory, fuel pump reconciliation, and dispatch.

And Kansas-based precision ag hardware and software provider AgJunction completed its merger with auto-steer solutions provider Novariant, helping AgJunction improve its presence in automated steering and machine control technologies. With a broad intellectual property portfolio including more than 140 patents, AgJunction aims to deliver application-specific solutions to precision agriculture customers worldwide.

The fundings-in-brief report just wouldn’t be the same without a nod to food e-commerce, which is continuing to make waves in the US and India, despite signs of cracks in the model. In another strategic investment for the segment, Bangalore hyperlocal delivery startup Opinio raised $7 million in Series A funding in a round led by e-commerce logistics company Delhivery; Amazon’s India-based rival Snapdeal led the $36 million Series B round for PepperTap earlier this month.

And Mumbai meal-kit startup iChef, raised an undisclosed amount from Springboard Ventures, according to VCCircle.

The trend for food delivery has also stretched to Egypt, where virtual grocer Knock Mart secured $3 million in funding through a convertible note. The company provides grocery deliveries in less than an hour and has its sights set on becoming the fastest grocery delivery business in the world, according to its website.

And elsewhere…

National Fish & Seafood, a US-based division of Pacific Andes Group, launched its new cloud-based mobile app, SourceTrace, for aqua farmers. The app enables complete traceability of an aqua farm, including data collection and management applications, which can be digitally entered into an Android-enabled system, on-site, and retrieved and analyzed by farm managers and National Fish & Seafood’s dedicated aquaculture team. It also keeps track of key documents like licenses, effluent records, and minutes of meetings and health certificates, which are required for Best Aquaculture Practices certification.

As Bayer CropScience locations across the country are celebrating Ag Literacy Week, the Senate Committee on Agriculture, Nutrition, and Forestry is considering the Safe and Accurate Food Labeling Act, which seeks to create a federal voluntary labeling program for GMO foods. The Committee debated the bill this morning in a much-anticipated session on capital hill. The bill passed the House back in July.

Another bill is gaining momentum in the legislature. Introduced by Rep. Thomas Massie (R-Ky.), the Processing Revival and Intrastate Meat Exemption Act, or PRIME Act, seeks to help producers of local grass-fed beef find cheaper and more efficient ways to meet the demands of consumers calling for locally-produced meat. The bill would legalize the sale of custom-processed meat direct to household customers and to restaurants, hotels, grocery stores, and other establishments that directly serve consumers in-state.

That’s all for AFN’s weekly funding report this week. Until next time, check out AFN’s report from last week’s Indoor Ag-Con in New York and find out which three challenges are facing the indoor agriculture industry.

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