Wood Creek Capital-backed sorghum seed developer Chromatin has acquired the sales and distribution network Marathon Ag Services for an undisclosed sum. Chromatin will use the network, which it has rebranded Majestic Semillas, to build its sorghum seed sales in Mexico.
Chromatin closed a Series E funding round on $36 million, led by Wood Creek Capital Management, at the beginning of 2014. GE Capital and BP Alternative Energy also contributed. Filings from January 2015 show Chromatin had raised $12 million out of a targeted $12.5 million and not yet held a final close on that funding round. According to published reports, Chromatin raised more than $75 million in five funding rounds between 2005 and 2015.
The company sees sorghum seed development as a growth business because of the plant’s versatility and ability to thrive in drought conditions, Chromatin chief executive Daphne Preuss told Agri Investor.
Sorghum is used as a source for starch, sugar and cellulose for biofuels, as well as forage and feedstock. The global sorghum trade is expected to grow to 9.1 million metric tonnes by 2025, an 8 percent increase on 2014, according to a United States Department of Agriculture report released last year. The report said the demand for animal feed in China has reshaped the global sorghum market.
“We feel there’s a huge opportunity in sorghum as we look around the globe. And a lot of that opportunity is the result of water availability,” she said.
“If you look at places around the world, whether it’s western Kansas, China or parts of Africa where we do business, there’s a real challenge with irrigation, and sorghum helps stretch water resources. It requires maybe half of the water that other key row crops do.”
Chromatin has engineered more than 80 seed varieties tailored to various climates and uses, and it has a sales presence in over 40 countries.
Wood Creek Capital Management, an affiliate of the MassMutual Life Insurance Company, invests in agricultural infrastructure, farmland, water and mining assets, as well as telecom and transportation.
Other investors in Chromatin include Malaysian Life Sciences Capital Fund, Unilever Technology Ventures and Quantitative Investment Management.