Agrium's (AGU) Unit Scoops Up Controlling Stake in Agricen


Fertilizer maker Agrium’s (AGU) subsidiary – Loveland Products – has bought a controlling stake in agriculture biotechnology company Agricen. Financial terms of the deal were not divulged.

Agricen offers biochemical-based products for efficient and sustainable plant nutrition. It makes two of Loveland Products' fastest growing plant nutrition brands – Accomplish LM and Titan PBA – that are geared to boost fertilizer efficiency.

Loveland Products is a global leader in high-performance crop input products catering to farmers in more than 40 nations. It is the proprietary products provider for Agrium Retail in North America, Australia and South America.

Agricen will retain its current name and will operate as a subsidiary of Loveland Products. Loveland Products also purchased a stake in Agricen's sister company – Agricen Sciences – which is developing novel microbial and biochemical solutions for plant health and nutrition. Under the deal terms, Loveland Products’ Vice President Brent Smith will assume the role of Chairman of the board of Agricen.

Earlier, Loveland Products and Agricen cut a strategic partnership deal in 2012 that provided the former an ownership interest in Agricen and an exclusive, global distribution rights to existing Agricen technology as well as access to an integrated pipeline of new product and technology.

The investment represents a part of Loveland Products’ long-term strategy of developing and marketing next-generation technologies which boost plant health and crop productivity and create value for farmers globally.

Agrium topped expectations in second-quarter 2014 on record results in its retail business, boosted by the acquisition of Viterra Inc.’s retail operations across Canada and Australia. The retail unit bounced back strongly after being hit by unusually cold weather in North America in the first quarter.

Agrium follows a strategy to grow along the value chain through a combination of acquisitions and organic development. It stands to gain from overall strong fundamentals for the agriculture and crop input market.

Agrium is a Zacks Rank #3 (Hold) stock.

Other companies in the fertilizer space worth a look include Potash Corp. of Saskatchewan, Inc. (POT), Chemical & Mining Co. of Chile Inc. (SQM) and Yara International ASA (YARIY). All of them retain a Zacks Rank #2 (Buy).

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