Chemicals firm Croda agrees £10m deal to buy agricultural business
DEAL AGREED: Croda is to buy-out UK bio-science firm Plant Impact.
By Hull Daily Mail | Posted: 26 Feb 2018
East Yorkshire-based chemicals giant Croda has announced a £10m deal to buy out a UK agricultural bioscience company.
Croda Europe has agreed the deal to acquire Plant Impact, which researches and develops crop enhancement chemistry to improve crop yield and quality.
The announcement brings Croda’s number of acquisitions and co-investments completed in the past 12 months to five.
Croda Europe is a wholly-owned subsidiary of Goole-headquartered Croda International.
The listed group was founded in 1925 and now has more than 4,200 employees across manufacturing sites and offices in 36 countries, including Hull.
Last year, the firm announced the major £27m expansion of its city facility near Clough Road.
The Hull investment will nearly double existing capacity and enable Croda to meet growing demand for polymer additives through to 2030.
AIM-listed company Plant Impact has its head office and research facility at the Rothamsted Centre for Research and Enterprise in Harpenden, Hertfordshire, as well as operations in Brazil, the US, Argentina and West Africa. It employs about 60 staff.
Both businesses have agreed to the terms of a recommended cash offer to be made by Croda Europe for the entire issued share capital of Plant Impact.
In December, the bioscience firm revealed that the loss of revenue from a key customer was set to hit sales for the 2018 financial year, and was in need of extra capital.
Steve Foots, group chief executive of Croda, said: "This is high quality, novel technology that further expands our position in the crop care sector, and supports our strategy of investing in high growth markets and world leading technologies.
“Plant Impact has assembled a great team, and we're really excited by the prospect of working with them to accelerate development of this business."
David Jones, chairman of Plant Impact, added: "Following the announcement by Plant Impact on 13 December 2017 regarding the 2018 revenue shortfall and the severe challenge this poses to the company, the board has reviewed its strategic options in parallel with conducting a wide ranging formal sale process.
“The board has concluded that the best interests of the shareholders are served by selling the company now whilst it remains able to support its trading activities from its remaining cash reserves.
"Furthermore, the board believes that Croda's plan for Plant Impact and Croda's current expertise and market position in agricultural chemistry is a firm basis for Plant Impact to fulfil the promise that we have consistently described for it and will therefore provide a more secure future for employees and other stakeholders in the Plant Impact Group."
The acquisition is expected to complete on March 28, subject to shareholder agreement.
Hull to benefit from 4m Northern Powergrid investment in bid to prevent blackouts