Oaktree-backed AGRO Merchants Group acquires Iberia coldstores

Oaktree-backed temperature-controlled storage provider AGRO Merchants Group has acquired the Iberian operations of Friopuerto for an undisclosed sum, bolstering its presence in a region seeing increased trade in fish and vegetables.

AGRO purchased one coldstore in Spain and two facilities in Portugal from Friopuerto, which was founded by a family-owned logistics company in 2003 as the only cold storage provider in the Port of Valencia before beginning to expand outside Spain in 2014. Under the terms of the deal, Friopuerto will continue operate facilities in Mexico, Morocco and Uruguay.

The 10,000-square-meter property in Spain remains the only cold storage facility located directly in the Port of Valencia, with 12,000 pallet spaces in total capacity and on-site inspection services for meat, fish produce and other commodities. In Portugal, AGRO acquired separate cold stores located at the ports of Sines and Leixoes, which were constructed in 2016 and 2017, respectively.

Headquartered in the Netherlands, AGRO operates 67 facilities across 11 countries in Europe, North America, Latin America and the Asia-Pacific region, making it the world’s fourth largest cold storage provider.

Oaktree’s initial $300 million investment into AGRO came in 2013, a source told Agri Investor in July 2017, after portfolio companies reported difficulty in securing cold storage and an analysis revealed the subsector’s high costs had kept it underdeveloped.

Last month, AGRO acquired Cool Pak Solutions, which provides storage and repacking services in the Port of Long Beach, California, for an undisclosed sum. Financial details were also undisclosed for previous AGRO acquisitions that have included Transmode, a regional transportation services provider in New Jersey, UK cold storage provider Grocontinental and Poland Services Transport Logistyka, a cold storage provider headquartered in Gdansk.

AGRO chief executive Carlos Rodriguez told Agri Investor his company had been familiar with Friopuerto for years.

Friopuerto has expanded into Portugal during the last three years, he said, establishing a presence in Leixores to facilitate increasing trade flows of frozen fish from South America, South Africa and Asia. In Sines, he said, expansion was designed to facilitate trade in fresh produce in all of southern Europe.

“Because some of the other ports are getting more saturated and busy, those two Portuguese ports are winning market share and developing further,” he said. “We thought it would be a great opportunity to start there and grow in Portugal.”

Rodriguez said AGRO expects to add capacity at Leixores within about a year. The company is also planning an addition to Transmode’s meat-focused operations in New Jersey and a major expansion in the Dutch town of Urk, which hosts one of Europe’s largest seafood processing facilities.

“We see other opportunities in Europe and the US to continue expanding,” he said. “Some of them in existing properties and other ones by further acquisition.”

Investor interest in the cold storage has continued to increase, Rodriguez said, driven largely by continued growth in consumption and consumers’ growing focus on variety and seasonality of food.