Aqua Capital merges speciality fertiliser investments

The Brazilian food and agribusiness private equity firm has acquired Dimicron to merge with existing portfolio company Aminoagro, creating one of Brazil's largest fertiliser platforms.

Aqua Capital, the São Paulo-based food and agribusiness private equity fund has acquired a controlling stake in Dimicron, a speciality fertiliser producer. The acquisition is an add-on deal to Aminoagro, a company Aqua Capital acquired in 2013, and the two companies will create one of Brazil’s largest foliaceous fertiliser platforms, according to a press release.

Dimicron produces liquid fertiliser and macro and micronutrients while Aminoagro produces bio-stimulants for grains, vegetables and fruits. The acquisition of Dimicron will “complement the growth of Aminoagro”, Sebastian Popik, founding partner at Aqua Capital, told Agri Investor, as the two companies are “similar and different”.

Aminoagro and Dimicron’s operations are in different regions so the acquisition will help Aqua Capital expand its geographical reach in Brazil, he said outside the Global AgInvesting conference in New York.

The new platform will have an annual income of $40 million and represents $45 million of investment by Aqua, according to a press release.

Add-on deals like this are nothing new for Aqua; the firm merged two portfolio companies, StockTech and Comfrio,- in December to create Brazil’s largest cold storage company.  Popik plans to make two add-on deals and one new platform investment each year. He has about 120 to 125 acquisition targets in the pipeline of which the firm is actively evaluating 30 to 40.

“This is our focus: establishing true and advantageous partnerships. We seek companies that are typically family-owned, which we can offer our support to through a management team that combines operational expertise and entrepreneurial approach,” said Popik in a statement.

Aqua Capital Ag Fund I closed in 2013 on $173 million. Including capital raised outside of the fund, such as last December’s equity injection into the new cold storage business by AGRO Merchants Group,  Aqua has raised $220 million in total and the fund is about 70 percent invested.