Saturday, February 1, 2014

Suba Seeds acquires Condor Seed Production

There are not too many Italian companies that makes acquistions abroad, but there are those who do not fail to make acquisitions in an ultracompetitive market as the American one. One of these is Suba Seeds, the  Italy-based (Longiano) European leader in the production of seeds for vegetables, which bought for $6.5 million the 52% of the American Condor Seed Production, a company with headquarter in Yuma (Arizona), a producer and wholesale distributor of vegetable and herb seeds active in the same industry and specializes in the type "baby leaf". 

Suba Seeds is not new to these shots. The company, founded 40 years ago by Augusto Suzzi, has a history of mergers and acquisitions that resembles, by number of deals done, the paths of the best-known multinationals. The Italian company, which since 2011 is a true holding company, has bought several companies (including Sipas Packaging and Royal Seeds) and has created others to internationalize ( including Suba&Unico, the result of a merger, and Suba France) or to deal with other sectors (Food Suba).
In short, the titles to deserve for the nickname of "multinational pocket" are all there. And also the numbers, since the financial period ended in mid-2013 has seen a turnover of €46 million (an increase of 13% compared to 2012) and a net profit of €3 million. The investment in Condor Seed has been possible thanks to the capital contribution of Quadrivio SGR, which in late 2012 entered in the company shareholdering, acquiring 52% of the shares. The Founder and President of the company Augusto Suzzi keeps the 15.36% of the shares, while the CEO Giuseppe Tumedei the 11%, while the rest is split among the management.

That of making acquisitions was and is a true anti-crisis strategy for the group of Longiano which employs over 200 people. To go on the market with different companies is an advantage since the possibilities to sell produced items are much greater.

One of the underlying principles is that when competitors can be incorporated through acquisitions, it is best to do it. Condor Seed, the company acquired a month ago, specialized in the market called "baby leaf", was in fact a competitor , especially in Eastern Europe. Now the two companies work hand in hand instead of bumping into each other.  Condor Seed produces items that Suba Seeds does not commercialize and Suba Seeds makes products they normally Condor buys on the market. Now the two can internally handle the sale of these products. 

The group has become a worldwide leader in the seed sector, from production and selection up to sale. And a real boost arrived when Suba Seeds entered Asian markets with high potential.  The recession , however, does not spare anyone and if one limits itself to expand only in its own compartment, without looking at possible diversification, the risks increase. That's why Suba Seeds has jumped in other segments, such as food. 

Suba Seeds is one of the best example of traditional Italian SME where company owners love their company and above all their personnel. Consider that the first employee the company hired in 1976, Mr. Gualtiero Broccoli, is still working at Suba Seeds as general manager of the company warehouse.

The sowing was done well. At this pace, the group point along with Quadrivio SGR to reach €100 million in sales within the next three years.