TEL AVIV, Israel and
BEIJING, China, Oct. 29, 2020 /PRNewswire/ -- ADAMA Ltd.
("ADAMA") (SZSE: 000553) and Jiangsu Huifeng Bio Agriculture Co.,
Ltd ("Huifeng") (SZSE: 002496) today announced that they have
entered into an agreement in terms of which ADAMA will acquire a
majority stake in the vast majority of Huifeng's synthesis and
formulation facilities.
Transaction Overview:
- Phase I: As previously announced in November 2019, ADAMA will acquire a 50% stake in
Shanghai Dibai Plant Protection Co., Ltd. ("Dibai"), a wholly-owned
subsidiary of Huifeng focused on the sale and distribution of key
formulated crop protection products in China;
- Closing of Phase I is expected to occur in the coming weeks
subject to customary approvals and Closing conditions
- Phase II: Under the agreement now executed, ADAMA will
acquire:
- a 51% equity stake in Jiangsu Kelinong Co., Ltd. ("Kelinong"), a
newly established, wholly-owned subsidiary of Huifeng, to which
Huifeng is to transfer its key crop protection synthesis and
formulation facilities; and
- an additional 1% in Dibai;
- Following the completion of these transactions, ADAMA will hold
51% of the equity in both Kelinong and Dibai, providing ADAMA with
a majority stake in one of China's
leading crop protection manufacturers, and significantly bolstering
ADAMA's commercial presence in the China crop protection market
- The total cash consideration for both phases of the transaction
is approximately RMB 1,224 million
(approximately $175 million);
- Closing of Phase II is subject to customary Closing conditions,
including regulatory and other corporate approvals, and is further
subject to full resumption of production at the relevant facilities
of Huifeng. Huifeng has made significant progress in the
rectification of its environmental issues and is in the process of
obtaining approvals to resume production
activities.
Enhancing ADAMA's commercial reach in China:
In China, the acquisition of
Dibai will significantly bolster ADAMA's position and offering in
this key market. Dibai has an attractive portfolio of crop
protection formulations, exclusive license to more than 150
products registered by Huifeng and an experienced sales team of
approximately 170 employees across China.
In Phase I of the transaction, ADAMA will obtain the exclusive,
indefinite, royalty-free rights to license Huifeng's existing and
future registrations in China and
following Phase II, ADAMA will own all registrations, with all
sales of formulated products in China to be managed by ADAMA.
Gaining access to backward-integrated and competitive
positions in key molecules:
Through the acquisition of Kelinong, ADAMA aims to significantly
enhance its business both globally and in China, adding key backward-integrated
molecules with competitive positions, including Prochloraz,
Bromoxynil, MCPA, Epoxiconazole, and Trinexapec, expected to drive
significant growth through ADAMA's worldwide market reach.
Ignacio Dominguez, President and
CEO of ADAMA, said: "Through this acquisition, we continue to
accelerate our growth strategy both in the Chinese market as well
as globally, gaining significant competitive advantage in worldwide
markets through key backward-integrated molecules. Mr. Zhong Hangen, Chairman of Huifeng, has built
Huifeng into one of the leading crop protection manufacturers in
China, and we are excited to bring
it into the ADAMA fold as a key part of our global operational and
commercial infrastructure."
Mr. Zhong Hangen, Chairman of
Huifeng, added: "We are very pleased that our collaboration with
ADAMA has reached this crucial stage. We believe this commercial
and operational partnership between two strong companies – a
leading company in the China
market with a strong product portfolio and established sales force,
together with one of the world's leading crop protection companies
– will lead to significant new opportunities for expansion into the
global market for Huifeng's leading crop protection
products."
About ADAMA
ADAMA Ltd. is a global leader in crop protection, providing
solutions to farmers across the world to combat weeds, insects and
disease. ADAMA has one of the widest and most diverse portfolios of
active ingredients in the world, state-of-the art R&D,
manufacturing and formulation facilities, together with a culture
that empowers our people in markets around the world to listen to
farmers and ideate from the field. This uniquely positions ADAMA to
offer a vast array of distinctive mixtures, formulations and
high-quality differentiated products, delivering solutions that
meet local farmer and customer needs in over 100 countries
globally. For more information, visit us at www.ADAMA.com and
follow us on Twitter® at @ADAMAAgri.
About Huifeng
Jiangsu Huifeng Bio Agriculture Co., Ltd. (SZSE 002496) engages
in the research, development, production and sale of agrochemical
products as well as in the storage and transportation of
petrochemical products in China.
It is a producer of key active ingredients, most notably
Prochloraz, Epoxiconazole, Trinexapac, Bromoxynil, MCPA and 2,4-D,
as well as Glufosinate which is to commence operations in a newly
built facility. The company had total 2018 revenues in 2018 of
RMB 2,519 million (approximately
$370 million). Sales of agrochemicals
(active ingredients and intermediates as well as formulated crop
protection products) in 2018 were RMB 1,946
million (close to $300
million). The company was founded in 1989 and is
headquartered in Dafeng, Jiangsu
Province, China.
About Dibai
Shanghai Dibai Plant Protection Co., Ltd. is a wholly owned
subsidiary of Huifeng, and with its head office in Shanghai. The company was founded in 2001 and
is focused on the sale and distribution of crop protection products
in China.
Contact:
Ben Cohen
Investor and Public Relations
E-mail: ir@ADAMA.com
Tel: +972 73 232 1403
Zhujun Wang
China Investor Relations
E-mail: irchina@adama.com
Tel: +86 10 5671 8110
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SOURCE ADAMA Ltd.