AgriFORCE Growing Systems Ltd. an agrotechnology company focused on intellectual property and dedicated to the advancement of sustainable growing practices and food and vegetable products, announced today that it has signed a binding letter of intent to acquire Berry People LLC, a berry company with an increasingly international footprint and a scalable platform model.
The acquisition strengthens the AgriFORCE Brands division and enables the company to realize business synergies with UN(THINK), which aims to innovate in the specialty flour and grain products categories.
Berry People was founded in 2017 by berry industry veterans to create a new platform to meet market demand for a year-round, full-line supply of branded organic and conventional berries. Berry People quickly established a globally recognized trade brand and scalable business consisting of more than 200 retail and foodservice customers and more than 100 grower and exporter customers in the United States, Canada, Mexico, and Peru. Berry People reported unaudited net sales of $37 million for the year ended December 31, 2022.
The LOI (which will be followed by a definitive purchase agreement) provides for a purchase price of $28 million, consisting of $18.2 million in cash and $9.8 million in AgriFORCE restricted stock, which will be paid at closing to acquire 70 percent of Berry People's equity interests. Berry People will have the opportunity to earn future earnouts over the five years following closing, based on future revenue and EBITDA targets associated with agreed growth objectives.
In partnership with AgriFORCE, Berry People intends to further develop upstream integration into agricultural production through agricultural joint ventures and the use of licensed intellectual property developed as part of a scalable franchise model. The berry market has reached $9.65 billion in 2021 in the United States alone, with growth rates of about 10 percent or more each year since 2019-a trend that is expected to continue.
Mauro Pennella, president of AgriFORCE Brands, said:
- "We are excited to announce the LOI with Berry People, a thriving company with promising growth opportunities. The AgriFORCE Brands division offers today's consumers better and more nutritious foods and plant-based products, both in the form of improved grains and legumes with UN(THINK), and now in terms of fresh, nutritious berries."
Pennella continued:
- "We aim to maximize business synergies between Berry People and UN(THINK), in terms of distribution, retail, foodservice, and other sectors. We expect that the additional volumes coming in the next year from their new relationships with growers in Mexico should support robust growth in 2023."
- "In addition, we see a great fit with Delphy, given its well-established soft fruit and CEA consultancy and advanced research and development capabilities, which will work with Berry People and its grower-operators to increase yield and improve quality, enhance farming operations and support the spread of new varieties, strengthening Berry People's vertical integration and growth plans."
Jerald Downs, CEO of Berry People, said:
- "We are excited to join AgriFORCE, as we are mutually aligned on the company's vision and strategy, as well as AgriFORCE's desire to build the Berry People brand alongside the company's founders and industry-experienced management team. This ensures that we can be a reliable and grounded platform for our industry partners, other collaborators, and the broader communities we serve."
Source: Blue Book Services
