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CropLogic completes USA strategic acquisition

Taken from - 6 June 2017

CropLogic Limited (CropLogic or Company), the Christchurch-based predictive decision support system for agricultural growers is pleased to announce that it has completed the acquisition of Professional Ag Services Inc (ProAg), a North-West USA-based agronomy services company.

ProAg is based in Pasco, Washington, has a long and successful trading history, and is both well-known and highly regarded in the Pacific North West region and in the wider USA agricultural services industry. ProAg has been in business since 1987, operated profitably for 30 years and has a client base located largely in Washington State, but also in Idaho, Oregon, and Canada.

This acquisition will provide CropLogic with immediate access to the lucrative North American agricultural industry, and an established channel to further the Company’s presence and develop grower and processor relationships in those three key agricultural states in the USA. Pasco is at the epicentre of the Columbia River Basin, a region which is one of the hotbeds for the world in relation to input efficiencies in cropping. The acquisition will also provide CropLogic with over 60 collective years of agronomic experience and expertise, provided by the principals alone, who will remain in the business.

Soil moisture and aerial imagery analysis form the basis for the agronomy services provided by ProAg. Currently ProAg has over 100,000 acres under management, including 60,000 acres of high-margin crops, and employs 16 staff.

Jamie Cairns, Chief Executive Officer of CropLogic, said:

"Strategic acquisitions provide CropLogic with immediate market access, relationships, and acres under management and have always been a fundamental part of our market entry strategy. This acquisition meets many of our initial North American goals, and both parties are excited with the plans for the upcoming years. We believe that this first acquisition demonstrates CropLogic’s ability to execute the Company’s international growth strategy.

"One of the common criticisms of technology ventures, including agri-tech, is the ability to convert that technology into revenue. Our strategy provides us with the opportunity to firstly use our technology to transform and optimise the business model of the acquisition target itself before then introducing additional services to its clients. It is a two-phase approach that we believe reduces the cost and risk of market entry.

"We are excited for ProAg to be a part of the CropLogic Group and to have secured a base of operations in the US market. The US has been the primary strategic focus for CropLogic, and we are delighted to be able to demonstrate progress with an acquisition of this calibre ahead of our upcoming ASX listing."

Roger McCary, co-founder of ProAg, said:

"Our 30 years of field and business experience, coupled with CropLogic's knowledge of new technologies will make for a very exciting future. We and our employees are looking forward to working for CropLogic."

Mike Stephenson, co-founder of ProAg, said:

"All of us at Professional Ag Services are very excited, to say the least. We are looking forward to the future prospects the acquisition by CropLogic of New Zealand offers us. For the past 30 plus years it has always been our number one goal to provide our clients with the best most up to date actionable information possible, and this acquisition provides us a fresh new road map to continue to do just that.

"It’s an exciting time to be involved in agriculture, and to be positioned to truly bring new innovative state of the art technologies to growers throughout the Northwest."