Global specialty minerals and specialty chemicals provider ICL Group (ICL) has acquired Compass Minerals’ South American Plant Nutrition Business for $420 million to become Brazil’s leading specialty plant nutrition company.
The acquired unit offers solutions to cover all key crops in Brazil. It caters to over 32,000 farms directly or indirectly across the country and generates about half its revenue from direct-to-farm sales.
President and CEO of ICL, Raviv Zoller, said, “This acquisition, together with our recent acquisition of Fertilaqua in Brazil and our existing specialty plant nutrition business there, positions ICL as the leading specialty plant nutrition company in Brazil, one of the world’s fastest-growing agriculture markets.” (See ICL Group stock chart on TipRanks)
The acquisition is part of ICL’s strategy to achieve pole position in high-growth specialty plant nutrition markets and further seek long-term global leadership for its Innovative Ag Solutions division.
While expanding ICL’s product offerings, this acquisition also helps it achieve a better seasonal balance between its operations in the Northern and Southern hemispheres.
Recently, BMO Capital analyst Joel Jackson reiterated a Hold rating on the stock with a price target of $6 (12.8% potential downside).
Jackson noted, “The commodity price dynamic, in general, is bullish and ICL, like many others, will clearly benefit from it.”
Based on 3 unanimous Holds, consensus on the Street is a Hold. The average ICL price target of $6.83 implies the stock is fairly priced at current levels. Shares have gained 127% over the past year.
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