ICL Continues Expanding Its Specialty Plant Nutrition Footprint in North America

Rhea-AI Summary

ICL, a global specialty minerals company, has acquired Custom Ag Formulators (CAF) for approximately $60 million. This marks ICL's second Growing Solutions acquisition in 2024, advancing its goal to expand product offerings and growth in new markets. CAF, a North American provider of customized agriculture formulations, offers liquid adjuvants, enhanced nutrients, and specialty products.

CAF operates two U.S. facilities in Fresno, California, and Adel, Georgia, manufacturing liquid and dry formulations. These strategic locations enable same-day shipping to key growing regions across the U.S. The acquisition aims to meet local growers' needs through ICL's distribution partners and address specific requirements of farmers in diverse growing regions.

Positive

• Acquisition of Custom Ag Formulators for $60 million
• Expansion of ICL's Growing Solutions product offerings
• Access to new markets and growing regions in the U.S.
• Addition of two strategically located manufacturing facilities
• Ability to provide same-day shipping to key growing regions

Negative

• None.

Insights

Financial Analyst

ICL's acquisition of Custom Ag Formulators (CAF) for $60 million represents a strategic move to expand its specialty plant nutrition footprint in North America. This deal, the second Growing Solutions acquisition in 2024, aligns with ICL's stated goal of expanding product offerings and positioning for growth in new markets.

Key financial implications:

• Market Expansion: The acquisition provides ICL with immediate access to CAF's diverse product line and two strategically located U.S. facilities, potentially boosting ICL's market share in the specialty agriculture sector.
• Revenue Synergies: By integrating CAF's customized formulations with ICL's existing distribution network, there's potential for cross-selling opportunities and increased revenue streams.
• Operational Efficiency: The ability to ship same-day to key growing regions could lead to improved logistics and potentially lower operational costs for ICL in the long run.
• Growth Potential: The deal positions ICL to better serve the specific needs of local growers, potentially leading to increased customer loyalty and market penetration.

While the $60 million price tag seems reasonable for a company with 25 years of industry experience and strategic assets, investors should monitor how quickly ICL can integrate CAF's operations and realize synergies to justify the investment. The impact on ICL's balance sheet appears manageable, given the company's global scale, but it's important to consider how this fits into their overall acquisition strategy and capital allocation plans.

Agricultural Market Analyst

ICL's acquisition of Custom Ag Formulators (CAF) is a strategic move that significantly enhances its position in the North American specialty plant nutrition market. Here's why this deal is noteworthy:

• Product Diversification: CAF's portfolio of liquid adjuvants, enhanced nutrients and specialty products complements ICL's existing offerings, allowing for a more comprehensive solution set for growers.
• Customization Capabilities: The ability to provide customized formulations addresses a growing trend in agriculture where farmers seek tailored solutions for their specific crop and soil needs.
• Geographic Advantage: With facilities in Fresno, California and Adel, Georgia, ICL gains strategic positioning to serve major agricultural regions across the U.S., from the West Coast to the Southeast and Central regions.
• Market Responsiveness: The acquisition enhances ICL's ability to respond quickly to local market demands, with same-day shipping capabilities to key growing areas.
• Technological Integration: Combining ICL's global resources with CAF's expertise in custom formulations could lead to innovative product development, potentially giving ICL a competitive edge.

This move aligns with the broader industry trend of consolidation and specialization in the agricultural inputs sector. It positions ICL to better compete with other major players in the specialty fertilizer and crop nutrition space, potentially capturing a larger share of the high-value, precision agriculture market. Investors should watch for ICL's ability to leverage this acquisition to drive growth in its specialty plant nutrition segment, particularly in North America where demand for customized and environmentally efficient agricultural solutions is on the rise.

Second Growing Solutions acquisition this year adds local crop nutrition capabilities in U.S.

TEL AVIV, Israel--(BUSINESS WIRE)-- ICL (NYSE: ICL) (TASE: ICL), a leading global specialty minerals company, today announced it has acquired Custom Ag Formulators (CAF), a North American provider of customized agriculture formulations and products for growers, for approximately $60 million. CAF offers a diverse assortment of liquid adjuvants and enhanced nutrients, as well as various other specialty products. This latest Growing Solutions acquisition, the second of 2024, advances ICL’s stated goal of targeting acquisitions to expand its Growing Solutions product offerings and to position the business for further growth in new and adjacent end-markets.

CAF offers customized agricultural formulations and packaging and operates two U.S.-based facilities, with one in Fresno, California, and a second in Adel, Georgia. Both sites manufacture liquid and dry formulations, and their strategic locations mean CAF can ship same day to key growing regions on both the East and West Coasts and to the Central U.S.

“We are pleased to have Custom Ag Formulators join ICL and bring their expertise to our customers in the U.S.,” said Elad Aharonson, president of ICL Growing Solutions. “This acquisition helps further the growth of our global Growing Solutions business, by enabling us to meet the distinctive needs of local growers through our existing distribution partners. It also allows us to address the specific requirements of farmers across the growing regions of the West Coast and the Southeast, where crops – and their nutritional needs – can vary greatly.”

“Custom Ag Formulators was founded to provide quality products with custom formulations and packaging in a timely and efficient manner,” said Patrick Murray, principal and director of sales for Custom Ag Formulators. “For more than 25 years, our mission has been to consistently lead the industry in customer service, quality and product innovation, and we are excited to move this mission forward with ICL Group.”

About ICL

ICL Group is a leading global specialty minerals company, which creates impactful solutions for humanity's sustainability challenges in the food, agriculture and industrial markets. ICL leverages its unique bromine, potash and phosphate resources, its global professional workforce, and its sustainability focused R&D and technological innovation capabilities, to drive the company's growth across its end markets. ICL shares are dual listed on the New York Stock Exchange and the Tel Aviv Stock Exchange (NYSE and TASE: ICL). The company employs more than 12,000 people worldwide, and its 2023 revenues totaled approximately $7.5 billion.

For more information, visit ICL's website at icl-group.com.

To access ICL's interactive CSR report, visit icl-group-sustainability.com.

You can also learn more about ICL on Facebook, LinkedIn, YouTube, X and Instagram.

Forward Looking Statements

This announcement contains statements that constitute forward‑looking statements, many of which can be identified by the use of forward‑looking words such as “anticipate,” “believe,” “could,” “expect,” “should,” “plan,” “intend,” “estimate” and “potential,” among others.

Forward-looking statements appear in this press release and include, but are not limited to, statements regarding the company’s intent, belief or current expectations. Forward-looking statements are based on management’s beliefs and assumptions and on information currently available to management. Such statements are subject to risks and uncertainties, and actual results may differ materially from those expressed or implied in the forward-looking statements due to various factors, including, but not limited to: estimates, forecasts and statements as to management's expectations with respect to, among other things, business and financial prospects, financial multiples and accretion estimates, future trends, plans, strategies, positioning, objectives and expectations, general economic, market and business conditions, supply chain and logistics disruptions, energy storage and electric vehicle growth, the potential for new COVID-19 variants, global unrest and conflict, governmental and regulatory requirements and actions by governmental authorities, including changes in government policy, changes in environmental, tax and other laws or regulations and the interpretation thereof, and war or acts of terror and/or political, economic and military instability in Israel and its region, including the current state of war declared in Israel and any resulting disruptions to our supply and production chains. As a result of the foregoing, readers should not place undue reliance on the forward‐looking statements contained in this press release concerning the timing of the transaction, or other more specific risks and uncertainties facing ICL, such as those set forth in the “Risk Factors” section of its Annual Report on Form 20-F filed on March 14, 2024, as such risk factors may be updated from time to time in its Current Reports on Form 6-K and other filings ICL makes with the U.S. Securities and Exchange Commission from time to time.

Forward-looking statements refer only to the date they are made, and the company does not undertake any obligation to update them in light of new information or future developments or to publicly release any revisions to these statements in order to reflect later events or circumstances or to reflect the occurrence of unanticipated events.

View source version on businesswire.com: https://www.businesswire.com/news/home/20240729313286/en/

Investor and Press Contact – Global

Peggy Reilly Tharp

VP, Global Investor Relations

+1-314-983-7665

Peggy.ReillyTharp@icl-group.com

Investor and Press Contact - Israel

Adi Bajayo

ICL Spokesperson

+972-3-6844459

Adi.Bajayo@icl-group.com

Source: ICL Group LTD

FAQ

What company did ICL acquire in 2024?

ICL acquired Custom Ag Formulators (CAF), a North American provider of customized agriculture formulations and products for growers, for approximately $60 million in 2024.

How many Growing Solutions acquisitions has ICL made in 2024?

The acquisition of Custom Ag Formulators is ICL's second Growing Solutions acquisition in 2024.

Where are Custom Ag Formulators' manufacturing facilities located?

Custom Ag Formulators operates two U.S.-based facilities, one in Fresno, California, and another in Adel, Georgia.

What products does Custom Ag Formulators offer?

Custom Ag Formulators offers a diverse assortment of liquid adjuvants, enhanced nutrients, and various other specialty products for agriculture.

How does the acquisition of CAF benefit ICL (NYSE: ICL)?

The acquisition helps ICL expand its Growing Solutions product offerings, meet local growers' needs through existing distribution partners, and address specific requirements of farmers across diverse growing regions in the U.S.