Agrogalaxy announces purchase of 80% of agricultural inputs distributor Agrocat

AgroGalaxy (AGXY3) announced last Wednesday (8) the signing of a share purchase agreement for the acquisition of 80% of the equity interest of Agrocat Distribuidora de Insumos Agrícolas. The contract is subject to conditions precedent, including the approval of the Administrative Council for Economic Defense (Cade).

According to the company, the operation will consolidate AgroGalaxy’s leadership position with more than BRL 5.7 billion in revenue, of which BRL 3.8 billion are in inputs (base of 2020). The purchase will be made with cash from the IPO that took place in July, and whose funds raised have already been channeled towards the acquisition of Ferrari Zagatto and now of Agrocat, in addition to the acceleration of organic growth through the opening of new stores.

“It is a transformational business for the company, which not only makes us change levels in financial terms, but which greatly strengthens our presence in one of the most important regions for Brazilian agriculture and with a huge market potential, which are the states of Mato Grosso and Rondônia”, said Welles Pascoal, CEO of AgroGalaxy.

This is the second acquisition announced by the company in 2021. In June, the acquisition of Ferrari Zagatto was announced, whose closure took place in August. In April, the purchase of Boa Vista had also been completed. These three companies totaled R$ 1 billion in input sales in 2020, which would add R$ 2.76 billion to the input base sold by the company in the same period, representing a growth of 37%, informed the company.

“Agrocat is one of the most important agricultural inputs distributors in the country, with a beautiful history of over 20 years and partners who are passionate about the business and the success of its customers – and this is also a characteristic of AgroGalaxy. I am sure that this partnership between AgroGalaxy and Agrocat will continue to bring the best of the market for high-end inputs and services to farmers in Mato Grosso and Rondônia”, added Pascoal.

According to the company, the operation with Agrocat was based on 3 main pillars: “1) AgroGalaxy’s strategy of growing through mergers and acquisitions in regions where it does not yet have operations and difficult organic penetration, 2) the potential to accelerate the plan the growth of the two companies through synergies and value creation levers, and 3) Agrocat’s high levels of professionalism, with well-aligned management and operation teams, present in the field, and extremely competent”.

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