Year after Albaugh acquired Rotam: global product portfolio upgrading and capacity expanding

Date:03-08-2023

In December 2021, a super acquisition occurred in the global agrochemical industry when Albaugh Group, a U.S. generic agrochemical company, acquired Rotam, an agrochemical company headquartered in Hong Kong, China. With this transaction, Albaugh acquired a broad product portfolio which is extendable to new destination markets, with foreseeable increases in the market share in major global agricultural markets.

 

AgroPages has tracked the business dynamics of Albaugh and Rotam throughout 2022 after the merge, having found out that both parties were very active and dynamic during the year. Besides the new product registration in critical markets, the merged company expanded production capacity and undertook another important investment program. In this article, AgroPages would present the development dynamics of the merged company as the following:

 

Brand updated: Building a new brand image and increasing brand awareness

 

The first significant event after the acquisition was the launch of Albaugh’s worldwide new brand identity. In April 2022, Albaugh announced the launch of its new brand identity, which aims to continuously strengthen the competitiveness of the company’s crop protection products, whilst continued investment was made to expand business operations and to establish broader brand recognition, thus enabling the company’s brand to become a leading brand in the crop protection industry.

The new brand identity demonstrates Albaugh’s commitment to providing customers with preferred solutions and other options to facilitate growers’ production of healthier crops with high profitability. Albaugh has been making continuous improvements and investments in the expansion of its commercial capacity to provide customers with quality products at competitive prices, which bring to customers higher business value. Previously, Albaugh’s global brand image was launched in 2016. With the company’s brand updating, the brand effect is further enhanced.

Following close market dynamics and launching product to US market one after another

 

During the year, Albaugh launched several new products to the US market, which is its home market, focusing on the hottest market products of the year.

 

In April 2022, Prime Source, a subordinate of Albaugh, launched the fungicide AzoxyBio for the spring-season application. AzoxyBio is a systemic fungicide which integrates chemical molecules with biological substances. Its azoxystrobin and bio-fungicidal polygonum cuspidatum extract has the dual mode of action of Group 11 and Group P5, which can activate the plant immune system to achieve a satisfactory effect of disease resistance management, in addition to prevention and control of diseases on turf and ornamental plants. When mixed with liquid fertilizer and other products (including low-volume spray solutions) in hard water, it shows suitable suspension properties. 

 

As glufosinate is rapidly replacing glyphosate, becoming the dominant product in the applications to turf and ornamental plants in the United States, in June 2022, Prime Source launched a new glufosinate-based herbicidal mixture - Surmise SpeedPro XT (glufosinate 10% + nonanoic acid 11.08% + imazethapyr 3.18%) for application to turf and ornamental plants. The product encompasses the advantages of the broad herbicidal spectrum of glufosinate, the fast-acting of nonanoic acid and the long-lasting effect of imazethapyr, providing a convenient premix for non-selective herbicides.

In July 2022, Prime Source also launched Sublime, a selective herbicide for specialized turf management, on top of 2,4-D. This is a 3-compound herbicidal mixture containing mesotrione 5.20%, triclopyr 29.5% and dicamba 16.27%. Sublime is fit to control cold season turf weeds and part of dormant warm-season turf weeds, applicable to a wide range of premises, including golf courses, turf farms, sports fields, parks, residential and commercial buildings, cemeteries, airports and lawns. It is a high-efficient and differentiated product for the control of turf weeds.

 

Currently, research and development of seed treatment-related technologies have become a focus of attention in the global market. In 2022, Albaugh added two new products to its seed treatment portfolio.

 

In August 2022, Albaugh launched the seed treatment pesticide Legend 5L ST (thiamethoxam). The product is a broad-spectrum insecticide, which is active against both soil and foliar pests; its aqueous formulations can be used primarily for customization of mixed seed treatment products that provide better operability, stability, potency and application value while being used as a material for tank-mix with other seed treatment agents. Compared to imidacloprid or clothianidin, thiamethoxam is highly flexible on many crops. Going forward, Albaugh is prepared to continue launches of synergistic products based on imidacloprid.

 

In December 2022, Albaugh launched Ace™3.8L ST, a new seed treatment fungicide containing ipconazole for application in spring 2023. This broad-spectrum fungicide is active against soil-based or seed-based diseases for use in the customization of mixed seed treatment products. Ipconazole is a unique triazole fungicide which enhances the protection of a wide range of crops, including corn, soybean and cereal. Ace™3.8L ST is a further expansion of Albaugh’s seed treatment portfolio.

 

Expanding South American and Chinese markets with promotion of product combinations 

 

South America is Albaugh’s key market. In June 2022, Albaugh launched Appalus, an insecticide containing the active ingredient imidacloprid at 200g/L for control of Nezara viridula, with an apparent effect of control. One of the differentiated features of this insecticide lies in its suspension formulation (SC), an important resistance management tool, having been successfully applied to Integrated Pest Management (IPM), in line with the specific needs of the Brazilian agriculture. Albaugh is committed to supplying the market with customized, high-quality products.

 

In July 2022, Albaugh expanded its sugar energy industry product combinations and produced the pesticide Porcel 100 EC (pyriproxyfen) to control sugarcane froghopper (Mahanarva fimbriolata). The product can affect the larval development of pests, as its mode of action can terminate larvae’s growth into the ″instar″ stage. The product has a friendly ingredient and is selective to pollinators, Cotesia flavipes and natural enemies of sugarcane pests. Porcel’s efficacy is of vital significance to companies and sugar cane plantations in the sugar energy industry; aerial spraying has the advantages of convenient application, flexible arrangement, time-saving and reduction of cost. Albaugh added the product to its portfolio after acquiring Rotam Brazil.

 

After merging with Albaugh Group in the United States, Rotam continued the implementation of the established strategic goals and planning. At the same time, Rotam used the strong supply chain and the product advantages of Albaugh Group to introduce more high-value resources to increase the company’s business volume and market influence. In January 2022, Rotam China launched a novel copper agent which is the DELITE® suspension. Inorganic copper is one of the most successful compounds, DELITE®, which is not only a green pesticide, is also used in organic farming, with a larger number of sites of action, without resistance. Its diversified and flexible application method can be sprayed, irrigated, mixed and thrown. It is effective against fungi and bacteria, as well as being usable for virus inactivation.

 

In November 2022, Rotam cooperated with NIPPON SODA to launch a new product in China: Pythilock (picarbutrazox 10% SC), a landmark new compound for the control of lower fungal diseases. As a new patented compound to fix lower fungal infections, picarbutrazox is free of cross-resistance with other compounds and can satisfactorily solve the high resistance problem, since rotated use of agents with different mechanisms of action is an effective means to put off resistance.

Capacity of 2,4-D expanded

 

Albaugh is one of the largest manufacturers of crop protection products in North America. In 2022, due to the impact of the ″offshore″ and ″onshore″ industry movement, Albaugh decided to expand its 2,4-D capacity in Argentina and the United States.

 

In August 2022, Albaugh began production of 2,4-D in a large ″backward integrated″ plant in Argentina. This active herbicidal ingredient has long been relied upon by farmers around the world, so, Albaugh's new project resorted to very competitive expertise and infrastructures to have greatly increased Argentina’s production of its commercial crude-based key intermediates, such as chlorine, caustic soda and monochloroacetic acid. With the implementation of this project, Albaugh’s total investment in Argentina and the United States will exceed $50 million. Currently, the active ingredients required for in-house production are being outsourced from other manufacturers; Albaugh will continue to partner with manufacturers to meet the overall demand for 2,4-D products.

 

In September 2022, Albaugh expanded its North American production facility in St-Joseph, Missouri, having bought another 25 acres of land. The facility possesses several operational and logistical advantages, Albaugh’s investment in facility expansion is expected to significantly increase its global 2,4-D capacity. Meanwhile, expanding infrastructure will increase the capacity of the company’s other product lines. The project also includes a finished goods distribution center in several acres, which will be expanded to restructure the main facilities in St-Joseph, so as to meet the growing demand from Albaugh’s customers in the United States; new facility construction is scheduled for completion in early 2nd-quarter of 2023.

Enhancing collaboration with external business entities and continuing overseas acquisitions

 

In May 2022, Australian Grain Technologies (AGT) and Sipcam entered a strategic agreement with Albaugh, where an innovative planting management platform is introduced to Australian growers. The platform is called CoAXium Production System, which integrates the key elements of CoAXium, including the non-GMO herbicide-tolerant traits developed and owned by AGT, the superior barley germplasm, Aggressor® herbicide and the industry management model. The collaboration will allow growers to gain all benefits of the CoAXium barley production system, which, in the meantime, is protected by the industry management institution.

 

The collaboration is concentrated on the worldwide deployment of the CoAXium production system platform, aiming to help global grain growers improve the performance of novel weed control systems. The platform offers unique, novel technologies to global users; Aggressor provides growers with new tools to combat barley grassy weeds. The project involves the plantation of herbicide-tolerant barley varieties, addressing the issues of application of Agressor herbicides, the impact of rotative cultivation, herbicide-tolerance strategy and integrated weed control.

 

In January 2023, Albaugh acquired Industrias Afrasa located in Valencia, Spain. With operations in Europe, North Africa and the Middle East, Afrasa owns more than 350 product registrations across 28 countries, including 12-plus active ingredients, which are registered in Europe. Afrasa’s product line is focused on Mediterranean crops; this is a good complement to Albaugh’s product portfolio. Afrasa’s plant in Spain is built based upon the existing Slovenian plant, aiming to support the fast-growing business to the benefit of the joint success of both companies. Albaugh’s acquisition of Rotam and Afrasha gave birth to a strong product portfolio, providing more than 35 active ingredients to the European market and more sustainable crop protection solutions to farmers in Europe, the Middle East and Africa.

Conclusion

The total sales of Albaugh and Rotam after the merger have exceeded $2 billion while generating many multiple business advantages. Extensive product portfolio and innovative product and technology pipeline; sales of products to North America, South America, Europe, India and China; possession of large-scale manufacturing bases; strong resources in registration, research and development; setup of an excellent and professional team.

The year after the acquisition, Albaugh updated its brand identity and enhanced its brand influence. Focusing on the local agricultural characteristics in the United States and Brazil, Albaugh launched various new products, including fungicides, herbicides and insecticides, mainly used for lawns, ornamental plants, seed treatment and selective pest control. After the acquisition of Rotam, combined with Albaugh’s mature technical system and business resources, two suspension agents were launched in succession, which are both advantageous and characteristic compounds against fungal diseases. This is complements each other’s product portfolio. Albaugh also expanded the intermediate production facilities in Argentina and the United States, having increased the 2,4-D capacity to meet the growing market demand.

 

Albaugh is committed to providing high-quality generic active ingredient combinations and high-performance products. It has increased overseas acquisitions to increase its existing product portfolio and range of applications. Acquisitions have made Albaugh a more dynamic company with more resources and a stronger market position. Albaugh’s external collaboration will surely strengthen its research and development capability, which is the key to the enhancement of the competitiveness and the sustainable development of the company.

 

In summary, after the acquisition of Rotam, Albaugh has been making continuous brand upgrading; has continued supply of crop protection product combinations to meet the diverse needs of users; and has accelerated the addition of new products to develop more market segments and to bring benefit to farmers, distributors and partners worldwide. Albaugh has adapted new product launches to local conditions, thus creating differentiated solutions with diversified competition in the market. Meanwhile, Albaugh remains open to partnerships with other technology-based companies to increase the corporate value and company’s global presence. In addition, Albaugh is prepared to continue expansion of production facility and capacity to ensure sufficient supply; and will enhance the production capacity of core molecules to provide growers with more options, unique and customized services.