Monsanto Company and Remington Holding Company, LLC., announced today that they are forming a new joint venture with an initial strategic focus on sorghum. The joint venture is designed to drive a higher level of investment and innovation in sorghum and to provide greater market access to the cereal crop. Monsanto and Remington said the transaction is expected to close following customary regulatory approval.
Remington is the parent company of a leading provider of customized seed production, processing, logistics and related services to the global seed industry.
Monsanto and Remington will establish the joint venture, which will be called Innovative Seed Solutions, LLC, through Monsanto’s global sorghum breeding business and Remington’s cash. In a related transaction, a subsidiary of Remington will purchase Monsanto’s sorghum production assets in the United States. The joint venture partners have valued these transactions at approximately $169.5 million with a total cash payment of $110.5 million by Remington.
Going forward, Monsanto and Remington said the new joint venture will be governed by an operational board with senior executive representation from both companies. Together with this board, the joint venture will be led by Dan Zinck, who will serve as chief executive officer and will work with an international team to lead research, commercial and growth aspects of the business. Remington and Monsanto will have ownership stakes in the joint venture of 60% and 40%, respectively.
Remington noted that with today’s announcement, it has expanded its partnership-focused business model and strengthened its position as a multi-national service provider to the retail seed industry – improving product access for a diverse set of global, national, and regional customers that market and sell seed to growers.
“Since establishing the Remington business model over 30 years ago, we have had a singular focus on providing the highest level of quality and service to ensure the success of our customers,” said John Overbeck, CEO of Remington. “We are honored to have this opportunity to enhance our existing relationship with Monsanto and to expand upon our seed service solutions by enhancing the seed industry’s access to elite product offerings.”
Monsanto noted that the new joint venture will help expand the commercial and technology reach of its elite germplasm, and it will remain focused on delivering important product offerings for sorghum growers. Monsanto said it will source sorghum products derived from the joint venture and offer these products through its Asgrow, DEKALB, Channel and regional seed brand dealer networks globally.
“We recognize that our sorghum business has great potential to expand and grow both domestically and internationally,” said Mike Frank, vice president and chief commercial officer of Monsanto Company. “We believe by partnering with Remington in the joint venture, we can bring an increased level of focus, investment and resources into this crop space, driving greater stability and value from this business. We remain committed to treating our employees with respect as we work through the necessary approvals for this transaction and next steps with our U.S.-based facilities.”