Monsanto is expanding its portfolio with its latest agreement to purchase Seminis, a leading fruit and vegetable company. Monsanto will pay $1.4 billion in cash and assumed debt, as well as a performance-based payment of up to $!25 million payable by the end of fiscal year 2007.
With the latest dietary guidelines and increase focus on healthy alternatives Monsanto Chief Executive Officer Hugh Grant says the addition of Seminis "will be an excellent fit for our company as global production of vegetables and fruits, and the trend toward healthier diets, has been growing steadily over the past several years."
Seminis is among the most recognized in the vegetable-and-fruit segment of agriculture. Seminis supplies more than 3,500 seed varieties to commercial fruit and vegetable growers, dealers, distributors and wholesalers in more than 150 countries around the world.
Alfonso Romo, current chairman and chief executive officer of Seminis says his company brings "a complementary technology base and specialized expertise that can not only support economic growth for farmers, but contribute to the health and nutrition of consumers on a global scale."
Bruno Ferrari, currently the president and chief operating officer of Seminis, will continue to lead Seminis, which is expected to become a wholly-owned subsidiary of Monsanto upon completion of the acquisition. The Seminis business will report into Brett Begemann, executive vice president for Monsanto.
In its 2004 fiscal year, Seminis reported annual sales of $526 million. "This is a strong performing seed business that is generating good returns and has solid growth prospects," Grant says. "In the medium-term, there is strong potential for the Seminis business to benefit from the breakthroughs our people have made in plant breeding."
From a technology perspective, Monsanto intends to continue on the path taken by Seminis for its business, which is to focus on developing products via advanced breeding techniques. Longer term, biotechnology applications could be an option, and will be evaluated in the context of Monsanto's research-and- development priorities and potential commercial business opportunities.