Corteva Pens Agreement to Acquire Stoller

DECATUR, Ill. (DTN) -- Biologicals are big business these days and the announcement that Corteva, Inc., has signed a definitive agreement to acquire Houston-based Stoller for $1.2 billion is big news.

With operations and sales in more than 60 countries and 2022 forecasted revenues of more than $400 million, Stoller brings immediate scale and profitability in the biologicals arena.

Corteva has made other recent investments in the biological sector this year. In September, the company announced it had signed a definitive agreement to acquire Symborg, a company specializing in microbiological technologies based in Murcia, Spain. In October, Corteva and STI Biotechnologie announced a multi-year agreement for the distribution of two Lactobacillus strains for plant stimulations.

Stoller is a well-known brand to U.S. farmers. The company was founded in 1970 by Jerry Stoller at a time when the concept of biologicals was new. Those first products focused on the production of chelated micronutrients. Company research and development in the 1980s focused on nutrition deficiency and precise timing of supplying nutrients to influence plant production. Yield contest winners exploring the limits of what the crop plant can do took the Stoller message more mainstream. The company is widely viewed as a pioneer in marketing products that include physiological-signaling compounds, such as plant hormones, high-technology nutrients, and microorganisms that can be used alone or in combination to improve plant efficiency and promote plant resilience to stress.

"Biologicals provide farmers with sustainably-advantaged tools that complement crop protection technologies, and collectively, can work to address global challenges around food security and climate change. Stoller represents a leader in the Biologicals industry given its commercial presence and market expansion potential, while also delivering attractive growth and operating margins," said Corteva CEO Chuck Magro, in a news release. "In combination with Corteva's leading innovation organization, Stoller provides a platform for expanding and accelerating Corteva's Biologicals business to become one of the largest players in the rapidly expanding Biologicals market."

According to that Corteva release, the biologicals market is expected to grow high-single digits annually through 2035, representing approximately 25% of the overall crop protection market by 2035. Corteva's involvement has implemented strategies built around external and internal innovation, R&D collaborations, licensing and distribution agreements and acquisitions, the release read.

Stoller CEO Guillermo de la Borda noted the more than 50 years of history Stoller brings to the market. "We are proud to join forces with Corteva as we share a vision of helping farmers succeed in growing the nutritious food the world relies on," he said. "This announcement is a true testament to the incredible success and dedication of our teams across the globe who have helped us become one of the most trusted biostimulant and plant health companies in the world. Our innovative solutions and deep expertise will continue to make an impact for years to come."

The Stoller purchase price of $1.2 billion in cash represents an enterprise value multiple of approximately 12x based on Stoller's expected EBITDA for 2022 on a stand-alone basis. The purchase price will be paid at closing, which is anticipated to be completed in the first half of 2023 following regulatory approvals and satisfaction of customary closing conditions. The company expects that Stoller results will be accretive to both Operating EBITDA and Operating EPS for 2023.

For a DTN article on how to weigh biologicals in a farm setting https://www.dtnpf.com/…

Find the original news release https://www.corteva.com/…

For more information on Corteva's biological portfolio go to: https://www.corteva.com/…

For more information on Stoller go to: https://stolleragro.com/…

Pamela Smith can be reached at pamela.smith@dtn.com

Follow her on Twitter @PamSmithDTN

(c) Copyright 2022 DTN, LLC. All rights reserved.