Origin expands agronomy footprint in Poland

Origin Enterprises, the Dublin based parent of the UK’s Agrii agronomy services group, has grown its portfolio of businesses in Eastern Europe through the acquisition of a Polish arable marketing business.

The company has agreed to buy 100% of the equity in the Kazgod Group, which has its head office in Blonie just west of Warsaw, subject to regulatory approvals. Origin chief executive Tom O’Mahony says the addition of Kazgod will significantly augment its Dalgety operation in Poland, which services some 3,500 largely arable farmers, when it completes in December.

Kazgod, established in 1989, now employs over 200 people to service around 2,600 customers across its established direct farm and retail distribution network throughout central and eastern Poland. It distributes major arable inputs such as seed, fertiliser and crop protection products alongside agronomy services, and also procures cereals, oilseeds and corn from growers. In addition, the business manufactures its own range of foliar fertilisers. This will strongly complement Dalgety’s activities which are principally concentrated in western Poland, notes Mr O’Mahony. The two Polish operations will be integrated over the next three years.

Origin will pay €22.4 million, with €2.1m of the total subject to a three-year earn-out.  Kazgod reported a pre-tax profit of €1.2m on revenues of €200m in the year ended December 31st 2014. The acquisition is being funded from existing banking facilities. Last month Origin raised €86m through divesting its flour milling and food manufacturing interests (ATN July 31st). At the same time, it acquired two agronomy services companies in Romania for a total €54.4m. The Group already has a presence in the Ukraine through its Agroscope subsidiary.

“Kazgod, through providing transformative and meaningful scale expansion potential in Eastern Europe, furthers Origin’s strategic development objectives and positions the Group as the premier service provider to primary arable producers in Poland, “ says Mr O’Mahony. “The combination of Kazgod and Dalgety will bring benefits through new customer extension opportunity and an enhanced capacity for the development of new and innovative service propositions.

Kazgod is a highly focused business with a dedicated commitment to customer service and quality. We are delighted to welcome Kazimierz Kuzminski and his team to the Origin Group.”

Founder and president of the Kazgod Group Kazimierz Kuzminski adds: "I am pleased to have reached agreement with Origin. Kazgod together with Dalgety will enhance Origin’s competitive position in the Polish agri-services market.

“We now have a like-minded partner with a depth of technical resource and knowledge transfer capability that can transform the breadth and scope of service support to our customers.  Our client offering will take a substantial step forward through the continued efforts of my management and people together with Origin's industry-leading technical expertise and customer-oriented mindset."