France: Groupe Soufflet to be acquired by InVivo Group

InVivo Group, a leading national French agricultural cooperative group has entered exclusive talks to acquire French family owned Soufflet Group. Founded in 1900 Soufflet is today an international agri group and the leading private-owned cereal buyer in Europe. It operates in the barley, wheat and rice and pulses sectors, and supports wine growers.

Its subsidiary Malteries Soufflet is one of the three biggest malting companies in the world with malt houses in Europe, Latin America and Asia with a combined annual malt production capacity of 2,280,000 tonnes. In addition Soufflet is one of the leading milling companies in Europe.

The group has yearly sales of EUR 5.9 billion and employs 6.851 employees.

Because of the lack of a family successor, a sale of the group had already for long been subject of speculations. Currently Michel Soufflet (90), board chairman, and his son Jean-Michel Soufflet (63), chief executive are at the helm of the company.

InVivo is a group of 192 farmer-owned cooperatives which operates, around three areas of activity - Bioline by InVivo (agriculture), InVivo Retail (garden center and food distribution) and InVivo Wine (wine). The company is slightly smaller than Soufflet and has annual sales of EUR 5.1 billion and a workforce of 5,873 employees in 19 countries.

The combination of InVivo Group and Soufflet Group would lead to the creation of a French champion in agriculture and agribusiness with an international footprint, driven by the complementarity of their respective activities and the pooling of their resources. A deal would bring together their international grain trading activities while also associating complementary businesses with limited overlap, including Soufflet’s flour milling and malt production and InVivo’s wine distribution and garden retail.

With combined revenues of nearly €10 billion, about half of which would be generated outside France, and more than 12,500 employees worldwide, this new Group would have a strong positioning both in France and internationally, operating more than 90 industrial sites, including 59 sites in France.

“The new Group would be able to address the challenges and issues of societal, environmental and technological nature facing the agricultural and agribusiness sectors as well as the issue of food sovereignty while creating value for both farmers and all stakeholders of the French agri-business sector,” InVivo and Soufflet said in a joint press statement today.

According to the agreement, Soufflet would be maintained as a separate entity within the InVivo group, Soufflet management would stay for a transition period expected to last a few years, and the Soufflet brand would be preserved. No asset sales are planned. Closing of the deal, subject to the prior authorization of the competent anti-trust authorities is expected by the end of 2021.

The transaction price was not disclosed. InVivo said it expected to finance the acquisition through its own funds, bank loans and potentially by selling stakes in some activities to partners.

Philippe Mangin, Chairman of InVivo Group, commented the deal: “Access to food has become a strategic issue reinforcing the need to preserve the food sovereignty of both France – the ‘Made in France’ label – and Europe. Bringing our two Groups together would enable us to address this challenge by providing a 100% French answer and would represent a key driving force for the agricultural transition and the interests of ‘la Ferme France’.”  

The combination of the strengths of these two major French players would significantly enhance excellence and sustainability in the key sectors of wheat, barley, vegetal protein and winery – from the field to the consumer. The joint know-how and expertise of the two Groups would thus meet the expectations of citizens who are concerned about the quality and security of the food chain, the preservation of the environment and the promotion of territories and agricultural production.

Michel Soufflet, Chairman of the Supervisory Board of the Soufflet Group, said: “Soufflet Group’s heritage and family values remain the key assets of our identity and play a fundamental role in the relationship of trust that we have developed with farmers, our partners for more than 120 years. With this project, we would be able to continue serving and supporting our farmer customers to strive, as they have always done with us in the past.

The preservation of the Soufflet brand and the retention of its talents would constitute the corner stone of this combination, which would enable the new Group to leverage the best of InVivo Group’s and Soufflet Group’s values, positioning and know-how, benefiting all stakeholders.

Jean-Michel Soufflet, Chairman of the Executive Board of the Soufflet Group, added: “The success of this combination would be based on the preservation of each Group’s identity, continuing to capitalize on their roots, reputations as well as local and international footprints, in order to enable them to pursue their respective development and serve their partners, whether they are industrials or farmers, following the dynamics of the cereals sectors built up over the years. By joining forces with InVivo, our family Group would find a Franco-French solution to preserve its identity, ensure the continuity of its activities and maintain both its ties in Nogent-sur-Seine and its regional presence.

Driven by a common commitment to social and environmental responsibility and supported by enhanced investments and innovation to promote and preserve agro-resources, the combination of the two Groups would accelerate access of all farmers to the latest and most environmentally friendly solutions, with a view to a large-scale implementation by “la Ferme France”.

Thierry Blandinières, Chief Executive Office of InVivo, concludds: “Combining our common activities in the trading of cereals would strengthen the international positioning of the new Group. The complementarity of all our other activities as well as the consolidation of both our material and human resources, our legitimate expertise and unique agronomic knowledge, developed over decades, and our strong territorial presence would allow us to operate across the entire value chain. We would thus be ideally positioned to respond to the increasingly complex challenges arising from the agricultural and food transition that only major players are able to handle.

The employee representative bodies of both Groups have been informed of this project today and an information-consultation procedure would soon be launched.

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